Over the past year, the shares of Nexstar Media Group Inc. (NASDAQ:NXST) are up about 27%. Although I’m late to the party, I think the shares still represent good value and I’ll be buying. I’ll go through the reasons for my bullish take by focusing on the financial history, and by making a forecast based on my expectations for dividend growth. I’ll also look at the stock itself as a thing separate from the business. In my view, the market is too pessimistic about the shares at the moment, and I think investors would be wise to take advantage of the situation. When I’ve talked about Nexstar to friends, the idea that they frequently express is that this business is old media, and it will inevitably die. With apologies to Twain, I think reports of the death of “old” media are greatly exaggerated.
Background
The company is a television broadcasting and digital media company that operates in medium sized markets in the United States. As of the end of last year, the company owned and operated 170 full power television stations in just over 100 markets. These stations are affiliates of ABC, NBC, Fox, CBS, The CW, MNTV, and other broadcast television networks. The company broadcasts content 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. As of the end of last year, the company reached approximately 43.6 million households, representing just under 39% of the total.
