Business Overview / Sources of Revenue

Gray Media, Inc. (NYSE: GTN) is the largest owner of top-rated local television stations in the U.S., serving 113 markets and reaching about 37% of U.S. TV households[1][5]. The company’s core business is broadcasting, earning the majority of its revenue from local and national advertising sales, retransmission fees from cable/satellite providers, and digital advertising via its Gray Digital Media division[4][1]. Additional revenue comes from media production companies and studio facilities, such as Raycom Sports and Assembly Atlanta[1][4]. While the exact current revenue breakdown is not provided in the available sources, historically, most revenue has been generated from broadcasting (primarily advertising and retransmission fees), with digital and production segments representing a smaller but growing share[4].

Revenue Growth Potential and Recurrence

Gray Media (GTN) derives a substantial share of its revenue from recurring sources—specifically, retransmission consent fees and affiliate/licensing fees—which together account for 48.5% of total revenue. Advertising represents another 44% of revenue[5]. However, both these segments have seen flat growth over the last two years, and demand has recently slowed. Revenue has grown at an average rate of 11.4% annually in the past, but analysts expect a decline of 10.9% over the next 12 months, indicating weak near-term prospects for revenue growth[2][5]. This suggests that Gray Media’s revenue growth potential over the next 5+ years is limited, with the outlook being for potentially flat or declining revenues barring a significant industry or strategic shift[5].

Economic Moat Factors

Gray Media (GTN) possesses elements of an economic moat, though it is moderate. Its moat derives mainly from economies of scale and unique assets: as the largest owner of top-rated local TV stations, it holds dominant positions in 113 U.S. markets, reaching about 37% of U.S. television households[1][5]. This broad portfolio provides pricing power with advertisers and distribution partners, as well as operational efficiencies. Additionally, exclusive broadcast rights, such as its large Telemundo affiliate group and local sports partnerships, act as barriers to entry[1][5]. However, switching costs and network effects are limited—viewers can change channels or platforms easily, and advertisers have alternatives. Brand power is mostly local, not national. The moat is supported by local market leadership and content rights, but faces erosion from digital competition and shifting consumer habits[5].

Leadership

Gray Media (GTN) is led by Hilton H. Howell, Jr., who serves as Executive Chairman and CEO. Howell is not a founder but has been a top executive at Gray for many years, with his leadership tenure spanning over a decade[2][3][4]. He owns approximately 6.5 million shares of the company[4]. The executive team includes Donald P. LaPlatney (President and Co-CEO), James C. Ryan (EVP & CFO), and Mike Braun (Chief Digital Officer), among others[2][5]. The leadership is known for expansion into digital media and technological innovation[5].

Financial Health

Gray Media (GTN) has a debt-to-equity ratio of 194%, with $5.6 billion in debt and $210 million in cash, indicating substantial leverage and a weak cash-to-debt ratio[3][5]. Its EBIT covers interest by only 1.7 times, signaling limited buffer for debt servicing[3]. The company does generate free cash flow, with an enterprise value to operating cash flow ratio of 7.94, but the exact free cash flow margin is not specified[5]. There’s no evidence of significant share dilution or repurchasing activity in the latest filings. Overall, Gray Media’s balance sheet is highly leveraged and carries financial risk[3][5].

Last updated Jun 12, 2025