Shares of Tegna (TGNA) surged about 30% in after-hours trading. The upside followed a Wall Street Journal report that Nexstar Media (NXST), a key player in the U.S. television market, is in advanced talks to acquire Tegna.
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If finalized, the deal would mark another major consolidation in the media industry, giving Nexstar even greater reach across key regional markets. Currently, Tegna is worth $2.6 billion, while Nexstar is valued at $5.6 billion.
However, regulatory hurdles remain. The Federal Communications Commission (FCC) and Department of Justice (DOJ) will likely scrutinize the deal for antitrust concerns, especially given Nexstar’s dominant market position.
Potential Deal Benefits
It must be noted that Nexstar is already the largest local TV station owner in the country, with more than 200 stations reaching over 220 million people. Meanwhile, Tegna operates 62 stations in 51 markets, which would give Nexstar an even stronger national footprint.
Further, the combined company would control affiliates for all four major networks, Paramount’s (PARA) CBS, Comcast’s (CMCSA) NBC, Disney’s (DIS) ABC, and FOX (FOXA), in many regions.
What Is the Price Target for NXST?
Turning to Wall Street, NXST has a Strong Buy consensus rating based on five Buys and one Hold assigned in the last three months. At $213.50, the average Nexstar stock price target implies 14.29% upside potential.
