Gray Media (GTN) Rose 37% in Q1

Soumya Eswaran

Wed, Apr 23, 2025, 5:20 AM 3 min read

Miller Value Partners, an investment management company, released its “Deep Value Strategy” first-quarter 2025 investor letter. A copy of the letter can be downloaded here. The year 2025 has been unpredictable. After setting new highs in mid-February, the market saw a double-digit decline towards the end of the quarter, capping off a strong start to the year. As the administration implemented global tariffs, sentiment swiftly deteriorated due to growing economic uncertainty. In the quarter, the Deep Value Select strategy had a -12.8% drawdown compared to -.2% return for the S&P 1500 Value Index and -9.9% return for the S&P 600 Value Index. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its first-quarter 2025 investor letter, Miller Value Deep Value Strategy highlighted stocks such as Gray Television, Inc. (NYSE:GTN). Gray Television, Inc. (NYSE:GTN) is a television broadcasting company that operates television stations and digital assets. The one-month return of Gray Television, Inc. (NYSE:GTN) was -30.49%, and its shares lost 45.85% of their value over the last 52 weeks. On April 22, 2025, Gray Media, Inc. (NYSE:GTN) stock closed at $3.26 per share with a market capitalization of $367.865 million.

Miller Value Deep Value Strategy stated the following regarding Gray Media, Inc. (NYSE:GTN) in its Q1 2025 investor letter:

"During the quarter, the strategy’s largest positive contributor was Gray Media, Inc. (NYSE:GTN), with shares up +37%. Gray significantly lagged the strategy during the back half of 2024. While the company’s political advertising led the overall market, it fell below market expectations. Gray continues to generate strong free cash flow and successfully paid down more than $500M of debt during the past year. While the company has significant debt leverage, Gray has a much smaller amount of debt maturities over the next two years. Marketplace expectations for Gray’s future retransmission revenues remain very low providing a nice ongoing variant as management focuses on improving long-term retransmission agreements. Near-term risks include an advertising recession; auto advertising may be weaker over the coming months; however local advertising has so far remained resilient. Gray has the potential to deliver strong free cashflow next year and $2B+ over the coming 5 to 6 years. Ongoing debt reduction should accrue to the equity over time. We see long-term upside potential multiples of the current share price."

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