The Fools take a look at Air Media IPO

Stock watcher site Motley Fool has a piece looking at the IPO of Air Media, the Chinese digital screen network that has about 2,000 screens in airports and another 16,000 in Chinese commercial jets.

Despite competitors such as JC Decaux, AirMedia remains the dominant player in its market. The company operates 95% of the digital TV screens in 15 of China’s largest airports.

The macro trends also look promising. ZenithOptimedia projects that China’s advertising market will grow 18.1% per year from 2005 to 2009 (to a total of $20.6 billion). What’s more, the number of China’s air travelers has been growing 15.5% per year, according to the China Statistical Abstract 2007. And since AirMedia has one of the few national ad networks in China, the upcoming 2008 Olympics should be a nice boost.

Unfortunately, investors have inflated AirMedia’s valuation to roughly $2.4 billion. Even if the company doubles business for 2007, that’s still a frothy 64 times revenue. In other words, this is really a stock for those who can take a flier on an early-stage company in a strong growth market — which usually requires investors with a tough stomach for turbulence. Thus far today, the shares are already down 9%.

Air Media did $16 million in gross revenues for the first half of the year.

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2 Comments on “The Fools take a look at Air Media IPO”


  1. […] IPO frenzy continues In the last week or so we have seen IPOs from companies with screens on planes and buses. Now there’s word of yet another Chinese IPO in the digital screen market, this one […]


  2. […] Did you like this brief introduction? Find out about it in full detail here. […]


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