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Stock Analyst Update

Growth and Valuation Make Univision Attractive

Dominance of Spanish-language TV helps boost sales.


What Happened?
Spanish-language TV powerhouse Univision (UVN) reported Monday its 16th consecutive quarter of growth since its IPO, with revenue increasing 28% to $624 million. During the nine-month period, the company's EBITDA (earnings before interest, taxes, depreciation, and amortization), a proxy for cash flow, increased 29% to $230 million even after a $2 million special charge for a management resignation and $20.6 million in startup costs for Univision's Internet initiative. Net income for the nine months increased 65% to $81.5 million.

What It Means for Investors
We believe the results through the first nine months of 2000 underscore the soundness of Univision as an investment. Univision is still growing at a much faster rate than its competitors in the broadcasting industry: Over the past three years, Univision has grown at an average rate of 42% while its competitors have grown by only 8%. While the 28% revenue growth achieved in the first nine months of 2000 is slower than its three-year average, it's still a very fast rate, and much higher than its competitors' or the S&P 500 average.

Richard Wilson does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.