Company Reports

We expect that industry headwinds faced by linear television (the traditional form of TV that is watched at scheduled times) and the continued transition of advertising to digital media will result in ongoing challenges for Nexstar Media Group that lead its business to decline. Nexstar acquired Tegna in March 2026, though the deal is still subject to legal challenge. The consolidation should produce significant savings but does not change our outlook, as the deal increases reliance on linear television.

Excluding Tegna, which is now included in Nexstar's results but still prohibited from being integrated pending DirecTV's lawsuit, Nexstar second-quarter revenue rose 5% from last year, while its adjusted EBITDA margin expanded by 270 basis points, both driven by strength in political advertising.

Nexstar had an excellent first quarter, achieving top-line growth and margin expansion even after excluding the contributions from the March 19 acquisition of Tegna and political advertising. Nexstar remains subject to an injunction and litigation that threatens to undo the Tegna merger.

We expect that industry headwinds faced by linear television (the traditional form of TV that is watched at scheduled times) and the continued transition of advertising to digital mediums will result in ongoing challenges for Nexstar Media Group that lead its business to decline. Though the deal is still subject to legal challenge, Nexstar acquired Tegna in March 2026. The consolidation should produce significant savings but does not change our outlook, as the deal increases reliance on linear television.

Nexstar announced the completion of its Tegna acquisition moments after the US Department of Justice and Federal Communications Commission abruptly approved the deal and waived the TV station ownership cap that would have clearly prevented the merger. Eight states and DirecTV have filed lawsuits.

Nexstar reported a good fourth quarter, with higher distribution revenue and a 5% jump in core advertising revenue (which excludes political advertising) versus last year. Management said it's on track to close its Tegna acquisition by the end of the first half, but we doubt approval will be clean.

Nexstar reported a 12% year-over-year decline in net revenue. Excluding the absence of political ad revenue this year, revenue decreased 2%. Management is confident that the necessary deregulation to enable its Tegna acquisition is coming.

Nexstar and Sinclair have both chosen to preempt Jimmy Kimmel Live indefinitely in response to the show's return on Sept. 23. They will instead air local programming during the show's time slot.

Nexstar announced the acquisition of Tegna for $6.2 billion in cash, a 31% premium to Tegna's average stock price in the 30 days before Aug. 8, when The Wall Street Journal reported this merger was in the works. This deal would be positive, but it requires changes to existing regulations.

We expect that industry headwinds faced by linear television (the traditional form of TV that is watched at scheduled times) and the continued transition of advertising to digital mediums will result in ongoing challenges for Nexstar Media Group that lead its business to decline. The firm has agreed to acquire Tegna, which should produce significant cost savings but does not change our overall outlook for the business, as it increases current reliance on linear television, something Nexstar will need to get away from if it hopes to grow.

The Wall Street Journal reported talks of a merger between major station owners Nexstar Media Group and Tegna. Following the report, Tegna shares were up 30% with Nexstar shares increasing 5%.

Nexstar reported broadly positive results that were largely in line with our expectations. Revenue fell 3% on weaker political advertising and flat distribution revenue. The firm generated $91 million of net income.

Nexstar's first-quarter results were unsurprising, with revenue falling 4% on decreased political revenue and general advertising softness. Excluding political advertising, revenue was down 1.4% as the advertising decline outstripped minimal distribution revenue growth.

No-moat Nexstar concluded the year meeting our expectations as recent trends have largely persisted on both the positive and negative sides. Nexstar benefited from $254 million in political advertising sales during the presidential election cycle, but core advertising remains a sore spot with declines accelerating in the fourth quarter. The pay-TV industry continues to lose viewership, though the rate of subscriber decline has slowed at distributors. We believe revenue growth will remain constrained, but potential regulatory change could provide a boost. We are maintaining our $175 fair value estimate.

We expect that industry headwinds faced by linear television (the traditional form of TV that is watched at scheduled times) and the continued transition of advertising to digital mediums will result in ongoing challenges for Nexstar Media Group that lead its business to decline.

No-moat Nexstar Media Group’s third-quarter results were broadly in line with our expectations. Strong political advertising and distribution revenue drove record third-quarter sales. The potential for positive regulatory changes and slight slowing of pay-TV subscriber attrition rates paint a less volatile picture than Nexstar has experienced recently. After adjusting our model for more positive short-term distribution revenue growth and worse core advertising, we are raising our fair value estimate to $175 per share from $170.

We expect that industry headwinds faced by linear television (the traditional form of TV that is watched at scheduled times) and the continued transition of advertising to digital mediums will result in ongoing challenges for Nexstar Media Group that lead its business to decline.

Nexstar reported mostly positive second-quarter results, with most of the media business improving. We are maintaining our forecast and $170 fair value estimate.

Nexstar’s fourth-quarter results and 2024 guidance were consistent with our expectations. Strong distribution growth in the quarter offset a continued year-over-year decline in core advertising. While the adjusted EBITDA margin fell in 2023, we expect a bounce-back with political revenue in 2024. Despite this, we are lowering our fair value estimate to $170 from $205 to reflect a steeper contraction in advertising and distribution growth than we previously assumed amid uncertainty about the future of linear TV.

Nexstar’s fourth-quarter results and 2024 guidance were consistent with our expectations. Strong distribution growth in the quarter offset a continued year-over-year decline in core advertising. While the adjusted EBITDA margin fell in 2023, we expect a bounce back with political revenue in 2024. Despite this, we are lowering our fair value estimate to $170 from $205 to reflect a steeper contraction in advertising and distribution growth than we previously assumed amid uncertainty about the future of linear TV.