Sinclair Earnings: Record Political Revenue Displays Stickiness of Broadcast TV

No-moat Sinclair reported generally positive results, as third-quarter record political ad revenue grew 40% from 2020 despite the firm falling short of its aggressive guidance on multiple metrics. Despite a potential slowing in cord-cutting following the continued bundling of streaming services inside the Pay-TV ecosystem, we still think Sinclair is facing significant headwinds given its lack of ownership of the content it broadcasts. After adjusting our model for higher expectations for political revenue in presidential election years, we are raising our fair value estimate to $14 from $12.