Lamar is one of the largest owners and operators of outdoor
advertising structures in the U.S. Lamar reported lackluster first
quarter 2014 results with year-over-year improvement in revenues
and narrower loss. Lamar has registered higher sales of advertising
space with an increase in occupancy of its existing advertising
displays and acquisition of newer ones. The company also has ample
liquidity to fuel its growth engine. However, Lamar faces increased
headwinds in the form of rising operating expenses and competitive
pressures. We are changing our recommendation for Lamar from
Neutral to Outperform, largely driven by rising earnings estimates
on the back of its approval for REIT conversion.
Headquartered in Baton Rouge, Louisiana, Lamar Advertising
Company is one of the largest owners and operators of outdoor
advertising structures in the U.S. Although the company was founded
in 1902, Lamar has been publicly trading on NASDAQ since 1996. It
provides advertising services to restaurants, retailers,
automotive, real estate, health care, gaming, service, hotel and
motel, telecommunication, and amusement industries, including
entertainment and sports. Lamar together with its subsidiaries
provides outdoor advertising services in the United States, Canada,
and Puerto Rico.
Lamar has a single operating and reportable segment, namely
advertising. The company offers three types of outdoor advertising
displays: 1) billboards, 2) logo signs, and 3) transit advertising
displays. Lamar sells advertising space on two types of billboards:
bulletins and posters. Bulletins are generally large, illuminated
advertising structures and are typically located on major highways
and target vehicular traffic spots. On the other hand, posters are
relatively smaller than bulletins and are located on major traffic
arteries, city streets, and targeted vehicular and pedestrian
traffic spots. In addition to traditional billboards, Lamar also
offers digital billboards, which are usually located on major
traffic arteries and city streets.
Logo signs are normally located near highway exits, nearby gas,
food, camping, lodging and other attractions. Transit advertising
displays are advertising spaces sold on the exterior and interior
of public transportation vehicles, transit shelters and
Lamar Advertising Co. (LAMR): Read the Full
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