Lamar Rises After Report Says Rival May Lose N.Y. Transit Dealby
Outfront Media may lose MTA advertising contract, analyst says
Shares advance most since May 2015 following analyst report
Shares of Lamar Advertising Co. rose the most in more than 16 months after an analyst said that a competitor of the billboard company could lose a contract to provide advertising on New York City’s subways.
Lamar rose as much as 4.8 percent to $63.98, the biggest gain since May 6, 2015, and was trading at $63.70 at 2:17 p.m. in New York. The stock had gained 1.8 percent this year through Monday.
Citigroup Inc. analyst Jason Bazinet said in a note Monday that investors believe there’s a strong chance that Outfront Media Inc. will lose a contract with New York City’s Metropolitan Transportation Authority. Both Outfront and Lamar provide advertising on transit systems.
“It’s possible -- but not likely -- the MTA splits the business into pieces,” he wrote. Bazinet recommends buying Outfront and has a neutral rating on Lamar.
Outfront’s contract with the MTA generates $206 million in revenue, Bazinet said. The transit agency is expected to award a new contract by December, he said.
Lamar declined to comment on the analyst note. An e-mail seeking comment from Outfront wasn’t immediately returned.