Radio Station Valuation
Radio stations are almost always valued through a process called a Fair Market Valuation, or FMV. This process allows for recognition of the unique features of the broadcast industry:
- Value based on the number of people (POPS) covered by the station's signal, using a standard multiple
- Value based on the station's operating income (EBITDA or BCF) or cash flow, using a standard multiple
- Value based on the station's gross revenue (seldom used today)
If a station does not produce positive operating income, it is usually valued on a POPS, or persons covered basis, using a standard contour and per POP multiple.
Our Basic Valuation reports look at all available metrics.
Frequently Asked Questions
What is the difference between an "appraisal" and a "Valuation"?
Appraisal: An Appraisal is an estimate of the market value of property, usually real estate. It does not consider the value of operating income from the property. Physical assets such as buildings or land rarely comprise a significant portion of a radio station's fair market value.
Valuation: Fair Market Value (FMV) is generally defined as the cash, or cash equivalent, price for which a property would change hands betwrrn a willing buyer and a willing seller in an arms length transaction, both being adequately informed of the relevant facts, and neither being compelled to buy or sell In the absence of an actual sale, FMV may be estimated using industry accepted guidelines.
The FMV of a radio station uses one, or more, of these metrics:
- Operating Income
Broadcast Cash Flow
- Population Covered by Standard Countour
- Multiple of Revenue
Who We Are
Clifton Gardiner, President
Radio Station Valuation is a service of Clifton Gardiner & Company, LLC, a longtime broadcast brokerage firm. We have completed over 350 brokerage transactions and numerous radio station and cable television valuations during over 35 plus years in the business. The company's experience in building and owning stations gives us a deep insight into the real value of broadcast properties.
Our valuation services have been utilized by many owners and lenders, and are known for their accuracy. Our longtime industry experience helps insure a successful outcome. There are many reasons to engage Clifton Gardiner & Company to perform a valuation of your radio station, including anticipation of a capitalization, a merger or acquisition, or a sale of the station. This may also include exit and extate planning.
Valuing a radio station is a unique process that requires a thorough understanding of the characteristics of the broadcast industry and years of experience, along with an extensive data base of metrics.
We know and understand the marketplace as it relates to the "real life" current value of your enterprise. We have the experience and objectivity, and the professionalism to be able to prepare a very understandable and useful valuation report.