Investor note bullish on podcast & streaming as “catalyst” for leading radio groups

We saw Inside Radio’s coverage of an investor note by Daniel Day, an equity research analyst at B. Riley Securities, projecting growth metrics for the second half of this year, and 2022. Day’s job description defines his purview as covering iHeartMedia, Audacy, and Cumulus Media. Accordingly, his projections land on those three companies, and might or might not be interpreted as proxies for entire industries.

In the most general view, this report continued Covid-related declines in the second half of this year, and a rising tide of spot revenue in 2022 for all three companies. It’s different for his digital audio projections, where year-over-year growth is predicted to continue through this year and accelerate next year.


“We have made no changes to our robust growth estimates for digital, which primarily consists of podcast ad revenue, radio streaming ad revenue, and digital marketing services.” –Daniel Day, B. Riley Securities


Daniel Day estimates that iHeart will experience 93% year-on-year growth in Q3 for digital as a whole, and a whopping 150% for IHRT’s podcast business. Audacy (AUD) and Cumulus (CMLS) will also grow in this model, on gentler but still double-digit curves. He says the digital side of business provides “a potential positive catalyst” for these three companies.

This analyst’s focus on podcasting, and on iHeart, is also reflected in a research brief posted in September. (“Do You Know Where Your Podcast Exposure Is?”) which sets a “long runway” price target for IHRT stock at $42 (it is $21 at the time of this post).


“Although many investors appear to have largely written off podcasting as too niche and fragmented to justify a significant allocation, we expect this viewpoint to shift as ad spend in the medium increases over time. We see a significant gap between the mass appeal/popularity of podcasts and the relatively small overall ad spend on the medium.” –Daniel Day


He notes improving advertising technology, better audience measurement tools, and investment in “more professional content” to drive podcasting’s growing TAM (total addressable market).



Brad Hill