Comparing Nexstar Media Group (NASDAQ:NXST) and Paramount Global (NASDAQ:PARA)

Nexstar Media Group (NASDAQ:NXSTGet Rating) and Paramount Global (NASDAQ:PARAGet Rating) are both consumer discretionary companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, risk, valuation, analyst recommendations, earnings, dividends and profitability.

Institutional & Insider Ownership

96.0% of Nexstar Media Group shares are owned by institutional investors. Comparatively, 63.9% of Paramount Global shares are owned by institutional investors. 6.9% of Nexstar Media Group shares are owned by insiders. Comparatively, 0.4% of Paramount Global shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Nexstar Media Group and Paramount Global’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Nexstar Media Group 18.66% 32.72% 6.67%
Paramount Global 14.26% 7.90% 3.05%

Dividends

Nexstar Media Group pays an annual dividend of $3.60 per share and has a dividend yield of 2.1%. Paramount Global pays an annual dividend of $0.96 per share and has a dividend yield of 3.4%. Nexstar Media Group pays out 17.5% of its earnings in the form of a dividend. Paramount Global pays out 15.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Nexstar Media Group has raised its dividend for 9 consecutive years. Paramount Global is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk & Volatility

Nexstar Media Group has a beta of 1.54, indicating that its stock price is 54% more volatile than the S&P 500. Comparatively, Paramount Global has a beta of 1.58, indicating that its stock price is 58% more volatile than the S&P 500.

Earnings and Valuation

This table compares Nexstar Media Group and Paramount Global’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Nexstar Media Group $4.65 billion 1.50 $834.57 million $20.59 8.36
Paramount Global $28.59 billion 0.64 $4.54 billion $6.11 4.64

Paramount Global has higher revenue and earnings than Nexstar Media Group. Paramount Global is trading at a lower price-to-earnings ratio than Nexstar Media Group, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current recommendations and price targets for Nexstar Media Group and Paramount Global, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Nexstar Media Group 0 1 4 0 2.80
Paramount Global 1 1 1 0 2.00

Nexstar Media Group presently has a consensus target price of $210.43, suggesting a potential upside of 22.26%. Paramount Global has a consensus target price of $35.75, suggesting a potential upside of 26.10%. Given Paramount Global’s higher probable upside, analysts plainly believe Paramount Global is more favorable than Nexstar Media Group.

Summary

Nexstar Media Group beats Paramount Global on 11 of the 17 factors compared between the two stocks.

Nexstar Media Group Company Profile (Get Rating)

Nexstar Media Group, Inc., a television broadcasting and digital media company, focuses on the acquisition, development, and operation of television stations and interactive community websites and digital media services in the United States. The company offers free programming to television viewing audiences. As of December 31, 2020, it provided sales, programming, and other services through various local service agreements to 37 power television stations owned by independent third parties; and owned, operated, programmed, or provided sales and other services to 198 television stations. The company also offers video and display advertising platforms that are delivered locally or nationally through its own and various third party websites and mobile applications, as well as owns WGN America, a national general entertainment cable network. Its stations are affiliates of ABC, NBC, FOX, CBS, The CW, MyNetworkTV, and other broadcast television networks. The company was formerly known as Nexstar Broadcasting Group, Inc. and changed its name to Nexstar Media Group, Inc. in January 2017. Nexstar Media Group, Inc. was founded in 1996 and is headquartered in Irving, Texas.

Paramount Global Company Profile (Get Rating)

Paramount Global operates as a media and entertainment company worldwide. The company distributes a schedule of news and public affairs broadcasts, and sports and entertainment programming; acquires or develops, and schedules programming on the CBS Television Network that includes primetime comedies and dramas, reality, specials, kids' programs, daytime dramas, game shows, and late night programs; produces or distributes talk shows, court shows, game shows, and newsmagazines; owns and operates 29 broadcast television stations; and operates CBS Sports Network, a 24-hour cable channel that provides sports and related content, as well as streaming and cable subscription services. It also operates Paramount+, a digital subscription video on-demand and live streaming services; and creates and acquires programming for distribution and viewing on various media platforms, including subscription cable networks, subscription streaming, and premium and basic cable networks. In addition, the company develops, produces, finances, acquires, and distributes films. Paramount Global was formerly known as ViacomCBS Inc. and changed its name to Paramount Global in February 2022. The company was incorporated in 1986 and is headquartered in New York, New York.

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