The media industry is undergoing major change. The rise of digital media and social media has given people alternate avenues to access information. The speed and scale with which news and important information spread are unprecedented. Naturally, these trends bring opportunities and threats with them for existing media companies. One of the largest media companies in the US is Nexstar Media. It has a presence in the top 50 designated market areas and operates a staggering 199 television stations. The chances are that you regularly watch one of the channels owned by Nexstar Media. Nexstar is estimated to attract some 94 million unique users. If you are looking for communication stocks to buy, then market leaders like Nexstar are names that you may want to include in your watchlist.
Revenues And Income Growth
Nexstar Media has been posting positive earnings results during the last few years. Its revenue was $2.7 billion in 2018. It then grew to $3 billion in 2019 and went above $4.5 billion in 2020. The year-on-year growth between 2019 and 2020 was an impressive 48%. Net income dipped from $388 million in 2018 to $236 million in 2019. However, it then jumped to $808 million in 2020. The growth from 2018 to 2020 was 108%. One would point out that the year 2020 had significant ad revenue for many media businesses due to the US presidential elections. However, non-political ad revenue grew from $1.33 billion to $1.57 billion. So, while political ad revenue certainly boosted the financials, overall growth was also showing a positive trend. The one concern for Nexstar media is the digital revenue trend. It had fallen marginally from $242 million in 2019 to $223 million in 2020. However, if you are looking to buy media stocks, then Nexstar is certainly one stock that needs a closer look.
Nexstar Media’s strong financial performance has translated into the price trend of its stock. The stock was trading around $50 in 2016. In the five years that have gone by, the stock price has nearly trebled. On 27th August 2021, Nexstar Media was trading at a dividend yield of 1.88%.