Shares in media company Tegna (TGNA) switched off nearly 5% today after President Trump dialled down expectations of a $3.54 billion deal with Nexstar Media (NXST).
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Too Much ‘Fake News’
Trump said he would oppose a plan to raise or eliminate the current 39% cap on local TV station owners, which is currently being considered by the Federal Communications Commission (FC).
The President said he would not be in favor because the result would be an “expansion of the fake news networks, citing ABC News, owned by Disney (DIS) and Comcast’s (CMCSA) NBC News.
He is also concerned about the broader reach such a move could give to “radical left news networks.”
According to a report in Variety this stands in contrast to the position of FCC chairman Brendan Carr, who was appointed by Trump.
Carr has been a strong advocate for getting rid of the FCC’s decades-old rule limiting TV station groups from owning outlets that reach more than 39% of U.S. households. The National Association of Broadcasters also supports eliminating the cap.
Deal Hinges on Cap Change
The lifting of the cap is also necessary for Tegna to be acquired by Nexstar Media, whose shares also plunged today.
Nexstar owns America’s largest local television broadcasting group comprised of top network affiliates, with more than 200 owned or partner stations in 116 U.S. markets reaching 220 million people. Nexstar’s national television properties include The CW, America’s fifth major broadcast network.
It has had a strong 2025 compared with its peers – see below:
Acquiring Tegna would expand Nexstar’s presence covering 80% of TV households across key geographies.
Nexstar officially filed applications last week with the FCC that include a request for a waiver of the agency’s 39% ownership cap for local TV broadcasters.
“Nexstar’s acquisition of Tegna will provide us with the scale necessary for local journalism to thrive amidst a media landscape that is dominated by Big Tech and the legacy media companies, enabling us to continue not only investing in high-quality journalism and local news, but in serving our local communities in the best possible way,” Nexstar has said.
Tegna and Nexstar expect that their merger will be completed by the second-half of next year.
Is NXST a Good Stock to Buy Now?
On TipRanks, NXST has a Strong Buy consensus based on 3 Buy ratings. Its highest price target is $250. NXST stock’s consensus price target is $241.67, implying an 32.50% upside.
