E.W. Scripps Company (SSP) Shares Soar 6.31% on Market Sentiment

E.W. Scripps Company (SSP) shares surged 6.31% today, marking the second consecutive day of gains, with a total increase of 9.68% over the past two days. The stock price reached its highest level since March 2025, with an intraday gain of 9.90%.

The strategy of buying SSP shares after they reached a recent high and holding for 1 week showed poor performance over the past 5 years. The annualized return was -4.95%, significantly underperforming the market. This indicates that relying on recent highs as a buying trigger and holding for a short duration is not a profitable strategy for SSP.

The recent stock performance of E.W. Scripps has been impressive, with shareholders experiencing a 25% increase in share price over the last month. This surge reflects positive market sentiment towards the company's prospects.

However, concerns about the company's financial health and valuation have also been raised. E.W. Scripps has seen slow annual revenue growth of 1.2% over the last two years, lagging behind its peers in the consumer discretionary sector. Additionally, the forecasted shrinkage in free cash flow margin by 8.2 percentage points suggests higher capital consumption, which could be a cause for concern among investors.

Management's investment decisions have also come under scrutiny, with waning returns on capital raising questions about the company's strategic direction. The stock's current price of $2.93 implies a valuation ratio of 1x forward EV-to-EBITDA, which may not be attractive to some investors.

When compared to its competitors, E.W. Scripps has higher earnings but lower revenue than Altice USA. Altice USA trades at a lower price-to-earnings ratio, suggesting a potential valuation discrepancy between the two companies. This comparison could be influencing investor perceptions and contributing to the recent volatility in E.W. Scripps' stock price.