Southern Cross Media Group Ltd
SXL: XASX (AUS)
| Morningstar Rating for Stocks | Fair Value | Economic Moat | Capital Allocation |
|---|---|---|---|
| A$7.60 | Kmj | Jgdyfpf |
Adjusting Southern Cross for Share Consolidation
Business Strategy and Outlook
The impact of coronavirus on Southern Cross is severe, given the financial pressure that most advertising clients are under. When jobs are at risk and corporate survival is the foremost concern, advertising and marketing expenditures are increasingly becoming first thoughts in cost-cutting terms and an afterthought in strategy terms. With the AUD 169 million capital raising in April 2020, we believe Southern Cross' balance sheet has been sufficiently restored to weather the storm. This is augmented by management's heightened cost and cash flow discipline.