Nexstar Media Group Declares Quarterly Cash Dividend of $1.69 Per Share, Announces New $1.5 Billion Share Repurchase Authorization

Rhea-AI Summary

Nexstar Media Group (NASDAQ: NXST) has announced two significant financial decisions. Firstly, the company declared a quarterly cash dividend of $1.69 per share, payable on August 23, 2024, to shareholders of record as of August 9, 2024. Secondly, the Board of Directors approved a new $1.5 billion share repurchase program. This authorization is in addition to the existing program announced in July 2022, which had $496 million remaining as of May 8, 2024.

While Nexstar intends to continue paying regular quarterly dividends, future payments will be subject to quarterly review and Board approval. The share repurchase program will be executed at the Board's discretion, subject to regulatory limitations.

Positive

• Declared quarterly cash dividend of $1.69 per share
• Authorized new $1.5 billion share repurchase program
• $496 million remaining from previous share repurchase program

Negative

• None.

Insights

Financial Analyst

Nexstar Media Group's latest financial moves signal a robust commitment to shareholder value. The declared $1.69 per share quarterly dividend maintains the company's attractive yield, while the new $1.5 billion share repurchase program is a significant expansion of capital return initiatives.

The dividend payout demonstrates consistency in Nexstar's shareholder remuneration strategy. At current share prices, this translates to an annualized yield of approximately 4%, which is competitive within the media sector. This steady income stream is likely to appeal to value investors and those seeking reliable cash flows.

However, the real story here is the share repurchase authorization. With $496 million remaining from the previous program and an additional $1.5 billion now approved, Nexstar has earmarked nearly $2 billion for buybacks. This represents roughly 25% of the company's current market capitalization, a substantial commitment that could significantly reduce the share count and boost earnings per share.

The magnitude of this buyback program suggests management's confidence in Nexstar's financial health and future prospects. It also indicates that the board views the current share price as undervalued relative to the company's intrinsic worth. Investors should note that such large repurchase programs can provide a floor for the stock price and potentially drive it higher.

While these capital return initiatives are positive for shareholders, they also raise questions about Nexstar's growth strategy. Such substantial buybacks might suggest organic growth opportunities or a lack of attractive acquisition targets in the current market. Investors should monitor how this capital allocation decision impacts the company's ability to invest in future growth initiatives or navigate potential industry disruptions.

Market Research Analyst

Nexstar's dividend declaration and share repurchase authorization offer intriguing insights into the broader media landscape. This move comes at a time when traditional media companies are grappling with the shift to streaming and digital platforms, making Nexstar's financial strategy particularly noteworthy.

The company's ability to maintain a substantial dividend while simultaneously committing to large-scale share repurchases suggests a strong cash flow position. This financial strength is somewhat atypical in the current media environment, where many players are investing heavily in content and technology to compete in the streaming wars.

Nexstar's focus on returning capital to shareholders could be interpreted in two ways:

• It may indicate a mature business model with growth prospects, choosing to reward shareholders rather than reinvest in the business.
• Alternatively, it could suggest that Nexstar has found a sustainable niche in the evolving media landscape, possibly through its local TV station portfolio and NewsNation network.

The media industry is currently experiencing consolidation and transformation. Nexstar's strong financial position could potentially make it an attractive partner or acquirer in future deals. However, the substantial share repurchase program might also be seen as a defensive move, making the company a more expensive acquisition target.

Investors should consider how Nexstar's strategy compares to its peers. While some media companies are prioritizing content investment and digital transformation, Nexstar appears to be taking a more shareholder-friendly approach. This could attract value investors but may raise questions about long-term growth prospects in a rapidly changing industry.

IRVING, Texas--(BUSINESS WIRE)-- Nexstar Media Group, Inc. (NASDAQ: NXST) announced today that its Board of Directors declared a quarterly cash dividend of $1.69 per share of its common stock. The dividend is payable on Friday, August 23, 2024, to shareholders of record on Friday, August 9, 2024. In addition, The Board of Directors also approved a new share repurchase program authorizing the Company to repurchase up to $1.5 billion of its common stock. The new share repurchase authorization is in addition to Nexstar’s existing share repurchase program announced in July 2022, of which $496 million remained as of May 8, 2024.

While the Company intends to pay regular quarterly cash dividends for the foreseeable future, all subsequent dividends will be reviewed quarterly and declared by the Board of Directors at its discretion.

The share repurchase authorization will be executed at the Board’s discretion and any share repurchases are subject to regulatory limitations.

About Nexstar Media Group, Inc.
Nexstar Media Group, Inc. (NASDAQ: NXST) is a leading diversified media company that produces and distributes engaging local and national news, sports and entertainment content across its television and digital platforms, including more than 310,000 hours of programming produced annually by its business units. Nexstar owns America’s largest local television broadcasting group comprised of top network affiliates, with 200 owned or partner stations in 117 U.S. markets reaching 220 million people. Nexstar’s national television properties include The CW, America’s fifth major broadcast network, NewsNation, our national news network providing “News for All America,” popular entertainment multicast networks Antenna TV and Rewind TV, and a 31.3% ownership stake in TV Food Network. The Company’s portfolio of digital assets, including its local TV station websites, The Hill and NewsNationNow.com, are collectively a Top 10 U.S. digital news and information property. For more information, please visit nexstar.tv.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240726788994/en/

Investor:

Lee Ann Gliha

Executive Vice President and Chief Financial Officer

Nexstar Media Group, Inc.

972/373-8800

Joseph Jaffoni or Jennifer Neuman

JCIR

212/835-8500 or nxst@jcir.com

Media:

Gary Weitman

EVP and Chief Communications Officer

972/373-8800

gweitman@nexstar.tv

Source: Nexstar Media Group, Inc.

FAQ

When will Nexstar Media Group (NXST) pay its next dividend?

Nexstar Media Group will pay its next quarterly dividend of $1.69 per share on August 23, 2024, to shareholders of record as of August 9, 2024.

How much is Nexstar Media Group's (NXST) new share repurchase authorization?

Nexstar Media Group has authorized a new share repurchase program of up to $1.5 billion.

What is the remaining amount from Nexstar Media Group's (NXST) previous share repurchase program?

As of May 8, 2024, $496 million remained from Nexstar Media Group's previous share repurchase program announced in July 2022.

Are Nexstar Media Group's (NXST) future dividends guaranteed?

While Nexstar intends to pay regular quarterly dividends, all future dividends will be reviewed quarterly and declared at the Board of Directors' discretion.