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Nexstar Media Group (NXST)
:NXST

Nexstar Media Group (NXST) AI Stock Analysis

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Nexstar Media Group

(NASDAQ:NXST)

Rating:80Outperform
Price Target:
$203.00
▲(21.89%Upside)
Nexstar Media Group scores a solid 80, driven by strong profitability and cash flow, positive technical indicators, and attractive valuation. The company's strategic initiatives in sports programming and distribution are promising, but challenges remain with declining advertising revenue. Overall, the stock presents a balanced mix of growth potential and risks.
Positive Factors
EBITDA and Operational Efficiency
The company's ability to turn a revenue beat into a significant EBITDA beat demonstrates strong operational efficiency and management.
Financial Performance
Nexstar deserves credit for exceeding consensus on every revenue metric, with significant improvement in digital revenue and a revenue beat in the non-political advertising segment.
Revenue Diversification
The diversification of revenue away from ad spend helps provide some insulation from economic challenges.
Negative Factors
Ad Revenue Decline
Excluding political, ad revenues were 4% lower YOY, and non-political ads are expected to dip mid-single digits in the second quarter.
Share Performance
The share performance is flat year-over-year, right in the middle of the pack, with highly leveraged names generally doing better.

Nexstar Media Group (NXST) vs. SPDR S&P 500 ETF (SPY)

Nexstar Media Group Business Overview & Revenue Model

Company DescriptionNexstar Media Group, Inc., a television broadcasting and digital media company, focuses on the acquisition, development, and operation of television stations and interactive community websites and digital media services in the United States. The company offers free programming to television viewing audiences. As of December 31, 2020, it provided sales, programming, and other services through various local service agreements to 37 power television stations owned by independent third parties; and owned, operated, programmed, or provided sales and other services to 198 television stations. The company also offers video and display advertising platforms that are delivered locally or nationally through its own and various third party websites and mobile applications, as well as owns WGN America, a national general entertainment cable network. Its stations are affiliates of ABC, NBC, FOX, CBS, The CW, MyNetworkTV, and other broadcast television networks. The company was formerly known as Nexstar Broadcasting Group, Inc. and changed its name to Nexstar Media Group, Inc. in January 2017. Nexstar Media Group, Inc. was founded in 1996 and is headquartered in Irving, Texas.
How the Company Makes MoneyNexstar Media Group generates revenue through several key streams. The primary source of income is advertising sales from its television stations, which include both local and national advertising slots. The company benefits from retransmission consent agreements, where cable, satellite, and telecom providers pay Nexstar for the right to broadcast their local stations. Nexstar also earns revenue from digital advertising on its online platforms and websites. Additionally, the company engages in production and distribution of content, monetizing its broadcast and digital content through syndication deals and partnerships with other media entities. Significant revenue is also derived from political advertising, especially during election cycles, which provides a substantial boost to its earnings.

Nexstar Media Group Earnings Call Summary

Earnings Call Date:May 08, 2025
(Q1-2025)
|
% Change Since: 7.97%|
Next Earnings Date:Aug 07, 2025
Earnings Call Sentiment Neutral
Nexstar's first quarter results show a company successfully navigating industry challenges with record distribution revenue and strong performance in their CW and NewsNation segments. However, these achievements are tempered by declines in net revenue and advertising revenue, particularly in nonpolitical advertising. The company's strategic focus on sports programming, deregulation, and M&A opportunities highlights a forward-looking growth strategy, yet financial pressures from decreased advertising revenue remain a concern.
Q1-2025 Updates
Positive Updates
Record First Quarter Distribution Revenue
Nexstar achieved a record first quarter distribution revenue of $762 million, which increased by $1 million or 0.1% over the prior year quarter.
CW's Strongest Primetime Performance
The CW's primetime ratings in the first quarter of 2025 marked the strongest performance in eight quarters, surpassing other broadcast networks 74 times in key demos.
NewsNation Audience Growth
NewsNation continued to build momentum, growing its audience every month of the first quarter of 2025, and outperformed MSNBC and CNN in the key adult 25 to 54 demo.
Significant Sports Programming Success
CW Sports now includes over 400 hours of live sports programming annually, with NASCAR Xfinity series averaging over 1.2 million viewers, a 19% increase year-over-year.
Strong Financial Position
Nexstar's first quarter adjusted EBITDA was $381 million with a 30.9% margin and a reduction in net interest expense by $17 million compared to the prior year.
Negative Updates
Decline in Net Revenues
First quarter net revenues were $1.23 billion, a decline of 3.9% compared to the prior year, primarily due to a reduction in political advertising.
Decrease in Advertising Revenue
Advertising revenue of $460 million decreased by $52 million or 10.2% over the prior year, with significant pullbacks in the insurance and automotive categories.
Increased Losses at The CW
The CW's profitability in Q1 declined by mid-teens million due to additional sports programming and amortization that weren't present in the same quarter last year.
Company Guidance
During Nexstar Media Group's First Quarter 2025 Conference Call, guidance reflected a focus on deregulation and strategic consolidation to drive value. The company reported first quarter net revenue of $1.23 billion, a 3.9% decline due to reduced political advertising. However, record first quarter distribution revenue of $762 million, a 0.1% increase, highlighted growth in vMVPD subscribers and CW affiliations. The revenue mix included 63% from distribution and other sources, and 37% from nonpolitical advertising, with digital advertising contributing one-fifth of the latter. Nexstar also emphasized the CW's profitability efforts, citing the network's strongest primetime performance in eight quarters, partly due to successful sports programming. Looking ahead, the company plans to renew distribution agreements covering 60% of its subscriber base and continue share repurchases as part of its capital allocation strategy.

Nexstar Media Group Financial Statement Overview

Summary
Nexstar Media Group's financial performance is marked by high profitability and cash generation capacity, making it a strong player in the entertainment industry. The company is effectively utilizing its equity but carries a significant amount of debt, which could pose risks if not managed carefully. While the revenue shows a slight decline, the company maintains robust margins and cash flow ratios, reflecting operational efficiency.
Income Statement
80
Positive
Nexstar Media Group shows strong profitability with a gross profit margin of 58.5% and a net profit margin of 12.2% for TTM (Trailing-Twelve-Months). The EBIT margin stands at 22.6%, and the EBITDA margin is robust at 39.5%. However, revenue has slightly decreased compared to the previous annual period, indicating a potential area of concern for growth sustainability.
Balance Sheet
72
Positive
The company's balance sheet reflects a moderate debt-to-equity ratio of 2.91, indicating a reliance on debt financing. Return on equity is relatively strong at 29.2%, showcasing efficient equity utilization. However, the equity ratio is on the lower side at 19.7%, suggesting higher leverage which could pose financial risk.
Cash Flow
85
Very Positive
Nexstar Media Group demonstrates healthy cash flow with a free cash flow growth rate of 6.3% compared to the previous annual period. The operating cash flow to net income ratio is at 2.00, signaling strong cash generation relative to earnings. Furthermore, the free cash flow to net income ratio is high at 1.79, indicating excellent cash flow management.
Breakdown
TTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
5.36B5.41B4.93B5.21B4.65B4.50B
Gross Profit
3.13B3.19B2.81B3.21B2.80B2.79B
EBIT
1.21B1.27B708.00M1.31B1.18B1.38B
EBITDA
2.12B2.21B1.79B2.22B1.96B2.00B
Net Income Common Stockholders
655.00M722.00M346.00M971.00M834.00M811.50M
Balance SheetCash, Cash Equivalents and Short-Term Investments
152.70M144.00M147.00M204.10M190.87M152.70M
Total Assets
13.40B11.47B12.08B12.68B13.26B13.40B
Total Debt
7.67B6.52B7.13B7.00B7.46B7.67B
Net Debt
7.52B6.38B6.98B6.80B7.27B7.52B
Total Liabilities
10.87B9.20B9.77B9.91B10.41B10.87B
Stockholders Equity
2.52B2.26B2.30B2.74B2.85B2.52B
Cash FlowFree Cash Flow
1.18B1.10B850.00M1.25B1.06B1.04B
Operating Cash Flow
1.31B1.25B999.00M1.40B1.21B1.25B
Investing Cash Flow
-159.00M-102.00M-173.00M125.20M-232.10M-39.75M
Financing Cash Flow
-1.14B-1.15B-899.00M-1.51B-945.56M-1.29B

Nexstar Media Group Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price166.54
Price Trends
50DMA
160.69
Positive
100DMA
161.18
Positive
200DMA
161.19
Positive
Market Momentum
MACD
1.48
Positive
RSI
48.50
Neutral
STOCH
49.71
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NXST, the sentiment is Neutral. The current price of 166.54 is below the 20-day moving average (MA) of 170.59, above the 50-day MA of 160.69, and above the 200-day MA of 161.19, indicating a neutral trend. The MACD of 1.48 indicates Positive momentum. The RSI at 48.50 is Neutral, neither overbought nor oversold. The STOCH value of 49.71 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for NXST.

Nexstar Media Group Risk Analysis

Nexstar Media Group disclosed 23 risk factors in its most recent earnings report. Nexstar Media Group reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Nexstar Media Group Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
81
Outperform
$23.18B13.3516.89%1.00%15.70%26.73%
80
Outperform
$5.02B8.1928.46%4.47%8.00%71.49%
73
Outperform
$16.27B32.125.88%0.73%-5.43%135.46%
61
Neutral
$14.55B5.81-3.99%6.41%2.71%-31.56%
59
Neutral
$904.43M6.5834.07%7.69%11.62%
51
Neutral
$8.45B-28.56%0.89%-4.50%-898.86%
* Communication Services Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
NXST
Nexstar Media Group
166.54
21.09
14.50%
NWSA
News Corp
27.42
0.76
2.85%
SBGI
Sinclair Broadcast
13.00
2.04
18.61%
FOXA
Fox
53.69
20.63
62.40%
PARAA
Paramount Global
22.47
5.23
30.34%

Nexstar Media Group Corporate Events

Executive/Board ChangesShareholder Meetings
Dennis FitzSimons to Resign from Nexstar Board
Neutral
Mar 26, 2025

On March 21, 2025, Dennis FitzSimons announced his decision not to seek re-election as a director of Nexstar Media Group, Inc. He will complete his current term and resign from the Board and its Audit Committee at the 2025 annual stockholders meeting. His resignation is not due to any disagreement with Nexstar’s management or Board regarding the company’s operations, policies, or practices.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.