Critical Analysis: Liberty Media Corporation (LSXMK) versus Sinclair Broadcast Group (SBGI)

Liberty Media Corporation (NASDAQ: LSXMK) and Sinclair Broadcast Group (NASDAQ:SBGI) are both mid-cap computer and technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their earnings, valuation, dividends, risk, profitability, analyst recommendations and institutional ownership.

Volatility & Risk

Liberty Media Corporation has a beta of 2.52, meaning that its share price is 152% more volatile than the S&P 500. Comparatively, Sinclair Broadcast Group has a beta of 1.79, meaning that its share price is 79% more volatile than the S&P 500.

Profitability

This table compares Liberty Media Corporation and Sinclair Broadcast Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Liberty Media Corporation N/A N/A N/A
Sinclair Broadcast Group 9.70% 32.06% 4.29%

Dividends

Sinclair Broadcast Group pays an annual dividend of $0.72 per share and has a dividend yield of 2.4%. Liberty Media Corporation does not pay a dividend. Sinclair Broadcast Group pays out 24.8% of its earnings in the form of a dividend.

Valuation and Earnings

This table compares Liberty Media Corporation and Sinclair Broadcast Group’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Liberty Media Corporation $5.22 billion 1.80 $1.77 billion $1.36 30.90
Sinclair Broadcast Group $2.82 billion 1.08 $893.47 million $2.90 10.24

Liberty Media Corporation has higher revenue and earnings than Sinclair Broadcast Group. Sinclair Broadcast Group is trading at a lower price-to-earnings ratio than Liberty Media Corporation, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

78.0% of Liberty Media Corporation shares are owned by institutional investors. Comparatively, 76.9% of Sinclair Broadcast Group shares are owned by institutional investors. 28.2% of Sinclair Broadcast Group shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Liberty Media Corporation and Sinclair Broadcast Group, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Liberty Media Corporation 0 1 1 0 2.50
Sinclair Broadcast Group 0 0 5 0 3.00

Liberty Media Corporation currently has a consensus price target of $39.00, indicating a potential downside of 7.21%. Sinclair Broadcast Group has a consensus price target of $47.00, indicating a potential upside of 58.25%. Given Sinclair Broadcast Group’s stronger consensus rating and higher probable upside, analysts plainly believe Sinclair Broadcast Group is more favorable than Liberty Media Corporation.

Summary

Sinclair Broadcast Group beats Liberty Media Corporation on 9 of the 16 factors compared between the two stocks.

Liberty Media Corporation Company Profile

Liberty Media Corporation owns interests in subsidiaries and other companies, which are engaged in the media and entertainment industries. The Company’s principal businesses and assets include its consolidated subsidiaries Sirius XM Holdings Inc. (SIRIUS XM) and Braves Holdings, LLC (Braves Holdings), and its equity affiliate Live Nation Entertainment, Inc. (Live Nation). The Company’s segments are SIRIUS XM, and Corporate and other. SIRIUS XM provides a subscription-based satellite radio service. Through its subsidiaries and affiliates, the Company principally operates in North America. The Company also owns a portfolio of minority equity investments in publicly traded media companies, including Time Warner, Inc. and Viacom, Inc. SIRIUS XM transmits music, sports, entertainment, comedy, talk, news, traffic and weather channels, as well as infotainment services, in the United States on a subscription fee basis through two satellite radio systems.

Sinclair Broadcast Group Company Profile

Sinclair Broadcast Group, Inc. is a television broadcasting company. The Company focuses on providing content on its local television stations and digital platforms. The Company’s segments are broadcast, other and corporate. The Broadcast segment consists of its broadcast television stations. The content distributed through its broadcast platform consists of programming provided by third-party networks and syndicators, local news, it owns networks, and other original programming produced by it. It also owns digital and Internet media products that are complementary to its portfolio of television station related digital properties. It focuses on offering marketing solutions to advertisers. Its other business consists of original networks and content, digital and Internet solutions, technical services and other non-media investments.

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