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what it is
Reservoir buys songs and recordings, then gets paid every time people stream, license, or use them.
how it gets paid
Last year Reservoir Media made $159M in revenue. Music Publishing was the main engine at $95M, or 60% of sales.
why it's growing
Revenue grew 9.6% last year. Revenue up 181% mattered most because a royalty business at 64.4x earnings needs visible top-line growth to justify the price.
what just happened
Revenue hit $128M, up 181% vs. prior year, while reported EPS data across sources came in mixed.
At a glance
C++ balance sheet — some cracks in the foundation
64.4x trailing p/e — you're paying up for this one
2.5% return on capital — nothing to write home about
$0.12 fy2024 eps est
$159M fy2024 rev est
xvary composite: 39/100 — weak
What they do
Reservoir buys songs and recordings, then gets paid every time people stream, license, or use them.
This business gets paid when old songs keep getting used. Reservoir runs that royalty toll booth across a $159M revenue base with about 100 employees, according to company filings and source data. If your catalog owns the rights, every stream, sync, or radio spin can send cash back without making the song again.
How they make money
$159M
annual revenue · their business grew +9.6% last year
Music Publishing
$95M
+9.6%
Recorded Music
$47M
+9.6%
Management
$9M
flat
Middle East Rights Management
$8M
flat
The products that matter
copyright administration and licensing
Music Publishing
$119M · 75% of revenue
this is the core business. It brought in $119M and grew 12% last year. It is also the cleaner royalty stream, which is why it supports the company's 38.7% operating margin.
main cash engine
master recording royalties
Recorded Music
$40M · 25% of revenue
this segment manages 38,000 master recordings and added $40M of revenue last year. Growth was 4%, so it helps diversify the catalog but it is not the growth story.
secondary stream
Key numbers
64.4x
trailing p/e
You are paying 64.4 years of trailing earnings for a company expected to earn $0.12 a share in FY2025.
$428M
long-term debt
Debt sits at 40% of capital, which matters because royalty income is steady until it is not.
22.1%
operating margin
Operating margin means profit after running the business, before interest and taxes, so what: the catalog model has decent economics.
2.5%
return on capital
Return on capital means profit earned on the money tied up in the business, so what: the current asset base is not producing much.
Financial health
C++
strength
- balance sheet grade C++ — below average — limited financial resources
- risk rank 4 — safer than 20% of stocks
- price stability 35 / 100
- long-term debt $428M (40% of capital)
C++ — below average. watch for debt servicing and cash burn.
Total return vs. market
Return history isn't available for RSVR right now.
source: institutional data · return history unavailable
What just happened
beat estimates
Revenue hit $128M, up 181% vs. prior year, while reported EPS data across sources came in mixed.
EDGAR-backed data shows revenue of $128M and EPS of $0.06 for the latest quarter. Yahoo-listed last earnings shows $0.03 versus a $0.02 estimate, so the revenue jump is the cleaner proof point.
$128M
revenue
$0.06
eps
22.1%
operating margin
the number that mattered
Revenue up 181% mattered most because a royalty business at 64.4x earnings needs visible top-line growth to justify the price.
source: company earnings report, 2026
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What could go wrong
the #1 risk is the $10–$11 sale process ending with no deal.
med
deal risk is the whole setup
The board is evaluating competing non-binding proposals from Irenic Capital and a Wesbild/Richmond Hill consortium at $10–$11 per share. None of that is signed. Until it is, the premium is optional.
At $7.45, the stock already reflects takeover hope. If the process breaks, you are back to underwriting a standalone business at 64.4x trailing earnings.
med
$428M of long-term debt limits flexibility
Reservoir carries $428M of long-term debt, equal to 40% of capital. Enterprise value is about $1.0B against a $646M market cap. That gap is leverage doing the talking.
Even with a 38.7% operating margin, debt service competes with acquisitions, catalog investment, and buyout optionality.
med
catalog growth can slow faster than the multiple
Publishing grew 12% last year. Recorded Music grew 4%. That gap matters because the faster-growing segment is carrying the story. If new signings and licensing slow, the investment case gets ordinary fast.
A business earning $0.12 a share does not get much room for disappointment when the stock is priced for a strategic outcome.
At $7.45, you are buying below the $10–$11 proposal range, but you are also buying a leveraged $159M revenue business if no agreement shows up.
source: institutional data · regulatory filings · risk analysis
Pay attention to
deal spread
the gap between $7.45 and $10–$11
That spread is the market pricing deal uncertainty. If it narrows, odds are rising. If it widens, confidence is leaving the room.
calendar
the special committee decision
The board review matters more than another incremental beat. This is the catalyst that can reprice the stock in one filing.
trend
whether Publishing keeps outrunning Recorded Music
Publishing grew 12% last year versus 4% for Recorded Music. If that spread closes the wrong way, the standalone story gets thinner.
metric
debt versus operating margin
A 38.7% operating margin looks attractive until you put it next to $428M of long-term debt. Margin quality matters less if leverage eats the upside.
Analyst rankings
risk profile
below average
risk rank 4 — more volatile than most — brace for bigger swings.
chart momentum
average
momentum rank 3 — the stock is moving with the broader market, no unusual signal.
source: institutional data
Institutional activity
institutional ownership data for RSVR is being compiled.
source: institutional data
Price targets
3-5 year target range
n/a
n/a
$7
current price
n/a
target midpoint · n/a from current
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