With a 1-year target estimate now well above $100, investors are energized once again about Nexstar Media Group and its potential growth, once its likely acquisition of Tribune Broadcasting is complete and it spins stations — with Apollo Group/Cox Enterprises’ newly formed group taking them.
At the Closing Bell on Wednesday, Nexstar was up $1.91 to finish at a record high $90.80; in early after-hours trading 10 cents was given back, with NXST at $90.70.
Investors believe Nexstar at the end of 2019 will be at $107.82 — at least pending further revisions of its 1-year target estimate.
According to Simply Wall Street, Nexstar Media Group has a price to earnings ratio of 6.61, based on the last twelve months. In other words, at today’s prices, investors are paying $6.61 for every $1 in prior year profit.
“That’s below the average in the U.S. market, which is 17.4,” it notes. “The company may have significant debt, but EPS growth was good last year. If the company can continue to grow earnings, then the current P/E may be unjustifiably low.”