Unveiling Nexstar Media Group Inc (NXST)'s Market Leadership: A Comprehensive Analysis of ...
Nexstar Media Group Inc (NASDAQ:NXST) has recently been in the spotlight, drawing interest from investors and financial analysts due to its robust financial stance. With shares currently priced at $147.48, Nexstar Media Group Inc has witnessed a daily loss of 2.32%, marked against a three-month change of -8%. A thorough analysis, underlined by the GuruFocus Score Rating, suggests that Nexstar Media Group Inc is well-positioned for substantial growth in the near future.
Decoding the GF Score
The GF Score is a stock performance ranking system developed by GuruFocus using five aspects of valuation, which has been found to be closely correlated to the long-term performances of stocks by backtesting from 2006 to 2021. The stocks with a higher GF Score generally generate higher returns than those with a lower GF Score. Therefore, when picking stocks, investors should invest in companies with high GF Scores. The GF Score ranges from 0 to 100, with 100 as the highest rank.
Here is how Nexstar Media Group Inc ranks in each of these components:
Financial strength rank: 4/10
Profitability rank: 10/10
Growth rank: 10/10
GF Value rank: 9/10
Momentum rank: 7/10
Each one of these components is ranked and the ranks also have positive correlation with the long term performances of stocks. The GF score is calculated using the five key aspects of analysis. Through backtesting, we know that each of these key aspects has a different impact on the stock price performance. Thus, they are weighted differently when calculating the total score. With high ranks in profitability, growth, and GF value, and decent ranks in financial strength and momentum, GuruFocus assigned Nexstar Media Group Inc the GF Score of 95 out of 100, which signals the highest outperformance potential.
Understanding Nexstar Media Group Inc's Business
Nexstar Media Group Inc, with a market cap of $5.17 billion and sales of $5.25 billion, is the largest television station owner/operator in the United States, with 199 stations in 116 markets. Of its 199 full-power stations, 155 are affiliated with the four national broadcasters: CBS, Fox, NBC, and ABC. The 2019 merger with Tribune made Nexstar the top broadcast affiliate for both Fox and CBS as well as the number-two partner for NBC and number three for ABC. The firm has networks in 12 of the top 20 television markets and reaches over 68% of U.S. TV households. Nexstar also owns NewsNation (formerly WGN), a nationwide pay-television network, 75% of The CW, and a 31% stake in Food Network and Cooking Channel.
Here is the income breakdown of Nexstar Media Group Inc:
Profitability Rank Breakdown
The Profitability Rank shows Nexstar Media Group Inc's impressive standing among its peers in generating profit.
Nexstar Media Group Inc's Operating Margin has increased (2.52%) over the past five years, as shown by the following data: 2018: 27.05; 2019: 18.16; 2020: 30.32; 2021: 25.78; 2022: 27.73.
Furthermore, Nexstar Media Group Inc's Gross Margin has seen a consistent rise over the past five years, as evidenced by the data: 2018: 59.59; 2019: 55.63; 2020: 61.78; 2021: 59.93; 2022: 61.53. This trend underscores the company's growing proficiency in transforming revenue into profit.
The Piotroski F-Score confirms Nexstar Media Group Inc's solid financial situation based on Joseph Piotroski's nine-point scale, which measures a company's profitability, funding and operating efficiency.
Nexstar Media Group Inc's strong Predictability Rank of 5.0 stars out of five underscores its consistent operational performance, providing investors with increased confidence.
Growth Rank Breakdown
Ranked highly in Growth, Nexstar Media Group Inc demonstrates a strong commitment to expanding its business.
The company's 3-Year Revenue Growth Rate is 26.9%, which outperforms better than 90.9% of 956 companies in the Media - Diversified industry.
Moreover, Nexstar Media Group Inc has seen a robust increase in its earnings before interest, taxes, depreciation, and amortization (EBITDA) over the past few years. Specifically, the three-year growth rate stands at 34.5, and the rate over the past five years is 26.1. This trend accentuates the company's continued capability to drive growth.
Conclusion
Given Nexstar Media Group Inc's strong financial strength, profitability, and growth metrics, the GuruFocus Score Rating highlights the firm's unparalleled position for potential outperformance. This analysis underscores the company's robust financial health and its potential to deliver substantial returns to investors in the near future.
GuruFocus Premium members can find more companies with strong GF Scores using the following screener link: GF Score Screen
This article first appeared on GuruFocus.
