Hemisphere Media Group Inc. (NASDAQ:HMTV)
Hemisphere Media Group Inc. (NASDAQ:HMTV) has announced plans to repurchase $25 million worth of its Class A common stock. The repurchase program comes on the heels of a stellar Q1 where the company reported robust advertising revenue and subscriber growth.
Hemisphere’s Robust Growth
Hemisphere Media Group Inc. (NASDAQ:HMTV) continues to experience robust growth in the U.S. and Latin America markets. A 7% growth in subscribers and a 9% increase in adjusted EBITDA in the first quarter has confirmed the company’s strategic growth plan thereby justifying the repurchase program.
“We believe that our consistent strong performance, financial strength, differentiated business model and long-term growth prospects are not appropriately reflected in our current stock price. The stock repurchase program authorized by our Board of Directors underscores our commitment to creating shareholder value, while not impeding the financial flexibility to continue to invest in our business and pursue our acquisition strategy,” said CEO, Alan Sokol.
Hemisphere Media Group Inc. (NASDAQ:HMTV) has embarked on a strategic investment plan that the chief executive officer believes will translate into a significant long-term value. In addition to the REMEZCLA’s investment, Hemisphere Media Group Inc. (NASDAQ:HMTV) has also made a significant investment in Canal Uno, a joint venture in Colombia. The investments are part of an effort that seeks to strengthen the current portfolio of offerings while broadening the target audience.
Stellar Q1 Results
For the first three months of the year, the company reported net revenues of $33.2 million compared to revenues of $31 million reported in Q1 2016. Hemisphere Media Group Inc. (NASDAQ:HMTV) attributes the 7% increase to an increase in subscriber and retransmission fees, due to subscription base growth.
Hemisphere Media Group Inc. (NASDAQ:HMTV) also recorded an increase in advertising revenues helped by a growing market share in Puerto Rico as well as the success of the World Baseball Classic. An amendment to the company’s Term Loan and Strategic Investment activity resulted in a 10% increase in operating expenses that came in at $26.1 million.
Net income in the quarter grew by 9% to $14.5 million compared to $13.3 million reported in Q1 2016. Hemisphere Media Group expects its adjusted EBITDA for the year to increase by single digit percentage, driven by growth in subscriber and retransmission fees as well as advertising revenues.
Shares of Hemisphere Media Group Inc. (NASDAQ:HMTV) were up by 3.59% in Wednesday’s trading session ending the day at $11.55.
I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.
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About the author: James Marion is a University of Houston student studying Business with a concentration in Finance. James has interned with several investment professionals and hopes to pursue a career as a professional stock analyst after graduation.