Crisis for some is opportunity for others.  Remember early 2020 when it was fashionable to show pictures of streets with no cars and airplanes crashing behind out of home signs?  On April 16, 2020 Providence Equity and Ares capital invested $400 million in convertible preferred shares in OUTFRONT Media.  The preferred shares had a 7% dividend along with the right to convert the preferred shares into 25 million shares of OUTFRONT common equity at $16 per share.

Yesterday Providence equity announced it was converting its OUTFRONT preferred shares to common stock.  Billboard Insider computes that the OUTFRONT convertible preferred stock has generated a 36% per annum return to the preferred shareholders.  To make the math easy we computed the returns based on a hold of exactly two years.  Here are our calculations.

Return on OUTFRONT Media Preferred Stock ($$$ in millions)

You would have made an even higher return – 48% per annum – if you had purchased OUTFRONT common stock at $12.27 on April 16, 2020 and is not at $26.78.   The S&P 500 stock index increased by 25% per annum over the same time period.

Billboard Insider’s take:  Crisis for some is opportunity for others.  Providence Equity and Ares Capital have outperformed the stock market by showing confidence in the out of home industry.

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