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Why Sinclair Broadcasting Shares Jumped

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Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Sinclair Broadcast Group (NASDAQ: SBGI  ) gained as much as 14% today, after the media company announced plans to buy 18 TV stations for $370 million from Barrington Broadcasting Group.

So what: Sinclair is apparently on the warpath, as this acquisition comes just three days after it spent $99 million on four Cox stations. To avoid FCC conflict rules, Sinclair will sell one of its stations in Syracuse, and another in Peoria -- locations where it's gaining stations from Barrington. The market also seemed to like that Sinclair reached an agreement with DirecTV on a retransmission consent agreement.

Now what: Already one of the biggest independent television broadcasting companies, Sinclair will gain a further hold on the national audience with these deals. Currently, the group reaches 29.8% of American households. At a P/E under nine, and a dividend yield near 4%, Sinclair looks like a solid value play, and the new acquisitions should only help fuel growth. Shares should continue to move higher from here.

Stay connected with Sinclair Broadcasting. Add the company to your Watchlist by clicking right here.

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