Recently, Lamar announced that it has merged with and into its
wholly owned subsidiary, Lamar Advertising REIT Company, thereby
accomplishing the ultimate stage in the reorganization of its
business operations for qualifying as a real estate investment
trust ("REIT"). We believe the company's REIT conversion move to
capitalize on a seemingly more favorable tax environment is a
strategic fit for long-term growth. Though the company's
third-quarter 2014 earnings missed the Zacks Consensus Estimate by
a penny, the figure came above the prior-year quarter earnings.
This was attributable to a notable improvement in revenues and
operating income. The company boasts an impressive national
footprint and is a leading provider of logo signs in the U.S. It
has a diversified tenant base and operates in a
high-barriers-to-entry market due to permit restrictions. However,
there exists headwinds on the national level, particularly, in
terms of national ad spend. Also, issues surrounding interest rate
remains a looming concern for REITs.
Headquartered in Baton Rouge, LA, Lamar Advertising Company is
one of the largest owners and operators of outdoor advertising
structures in the U.S. 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 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 benches.
As of Nov 19, 2014, Lamar operates more than 150 outdoor
advertising companies in 44 states of the U.S., Canada and Puerto
Rico. In addition, the company has logo businesses in 23 states and
the province of Ontario, Canada and more than 60
transit-advertising franchises in the U.S., Canada and Puerto
On Nov 19, 2014, Lamar announced that it has merged with and
into its wholly owned subsidiary, Lamar Advertising REIT Company,
thereby accomplishing the ultimate stage in the reorganization of
its business operations for qualifying as a REIT.
Lamar Advertising Co. (LAMR): Read the Full
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LAMAR ADVER CO (LAMR): Free Stock Analysis
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