Analyst Jason Bazinet of Citi maintained a Hold rating on Nexstar Media Group (NXST – Research Report), with a price target of $158.00.
Geoff Meacham has given his Hold rating due to a combination of factors affecting the Nexstar Media Group’s financial landscape. On the positive side, Nexstar has potential to significantly boost its EBITDA with strategic moves, such as revitalizing The CW and acquiring ABC, which could add over $1 billion of incremental EBITDA. However, this optimistic outlook is counterbalanced by concerns regarding the sustainability of Nexstar’s Distribution revenues in the face of ongoing cord-cutting trends and new industry carriage agreements.
The tipping point for Nexstar’s future revenue streams may be the industry’s response to a recent agreement between Disney and Charter. This deal, which provides Charter’s customers free access to Disney+ and ESPN+, may diminish Nexstar’s bargaining power and, by extension, its retransmission fees, which currently constitute over half of the company’s revenues. Meacham’s neutral stance reflects this uncertainty, as the industry’s adoption of similar agreements could lead to long-term financial pressures for Nexstar. Until the direction of these crucial carriage agreements becomes clearer, the Hold rating is a position of watchful prudence.
NXST’s price has also changed moderately for the past six months – from $166.610 to $142.390, which is a -14.54% drop .
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Nexstar Media Group (NXST) Company Description:
Nexstar Media Group, Inc. operates as a television broadcasting and digital media company. It focuses on the acquisition, development and operation of television stations and interactive community websites and digital media services in the U.S. The company provides services free over-the-air programming which includes programs produced by networks with which the stations are affiliated; programs that the stations produce; and first-run and rerun syndicated programs that the stations acquire. It also provides digital publishing and content management platforms to media publishers and advertisers. Nexstar Media Group was founded by Perry A. Sook in 1996 and is headquartered in Irving, TX.
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