Nexstar Media Group Inc. Common Stock (NXST)

FairStock Score: 24/100 — RISKY

Key Financials

Strengths

• Generates $942 million in annual free cash flow (15.3% yield on market cap)
• Attractive 3.5% dividend yield providing steady income returns

Concerns

• Trades significantly above Graham Number ($68) with negative 200% margin of safety—limited downside protection
• High leverage at 3.21x debt-to-equity increases financial risk and interest expense burden
• Currently unprofitable—sustained losses could lead to dilutive capital raises or balance sheet deterioration
• Revenue declining at 13.3% year-over-year signals potential demand weakness or market share loss

AI Analysis

Nexstar Media Group Inc. Common Stock is a small-cap communication services company valued at $6.2 billion. Revenue stands at $4.9 billion, though the company is currently unprofitable. From a quality standpoint, Nexstar shows distressed Altman Z-Score of 1.2 warrants caution and modest 4% ROE. On valuation, the stock is commanding a steep 68.0x multiple, with trades far above its Graham Number ($68) with no margin of safety. Growth dynamics show revenue growing at -13.3% and profit growth of -168.6%. The 3.5% dividend yield adds an income component for patient holders. Our composite FairStock Score of 24/100 reflects below-average fundamentals overall. Without profitability, this remains speculative—suitable only for those with high risk tolerance and a long time horizon.

Bull Case

Improving fundamentals and sector tailwinds could drive meaningful earnings growth, compressing the effective multiple for patient investors. With $942 million in annual free cash flow (15.3% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

At 68x earnings, any growth disappointment triggers rapid multiple compression—a 20% earnings miss plus multiple contraction to 20x implies 40%+ downside. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer