AMC Networks (NASDAQ: AMCX) and TEGNA (NYSE:TGNA) are both mid-cap cyclical consumer goods & services companies, but which is the superior business? We will contrast the two businesses based on the strength of their profitabiliy, analyst recommendations, institutional ownership, dividends, risk, earnings and valuation.

Risk & Volatility

AMC Networks has a beta of 1.03, suggesting that its share price is 3% more volatile than the S&P 500. Comparatively, TEGNA has a beta of 1.74, suggesting that its share price is 74% more volatile than the S&P 500.

Dividends

TEGNA pays an annual dividend of $0.28 per share and has a dividend yield of 2.0%. AMC Networks does not pay a dividend. TEGNA pays out 15.0% of its earnings in the form of a dividend.

Profitability

This table compares AMC Networks and TEGNA’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
AMC Networks 19.80% 79,761.30% 12.78%
TEGNA 12.25% 19.16% 5.64%

Earnings and Valuation

This table compares AMC Networks and TEGNA’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
AMC Networks $2.77 billion 1.28 $845.29 million $4.14 12.89
TEGNA $3.34 billion 0.92 $1.16 billion $1.87 7.64

TEGNA has higher revenue and earnings than AMC Networks. TEGNA is trading at a lower price-to-earnings ratio than AMC Networks, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

81.7% of AMC Networks shares are owned by institutional investors. Comparatively, 86.6% of TEGNA shares are owned by institutional investors. 17.7% of AMC Networks shares are owned by insiders. Comparatively, 0.8% of TEGNA shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of recent recommendations and price targets for AMC Networks and TEGNA, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
AMC Networks 1 7 7 0 2.40
TEGNA 1 3 5 0 2.44

AMC Networks presently has a consensus target price of $60.18, suggesting a potential upside of 12.74%. TEGNA has a consensus target price of $23.31, suggesting a potential upside of 63.25%. Given TEGNA’s stronger consensus rating and higher possible upside, analysts clearly believe TEGNA is more favorable than AMC Networks.

Summary

AMC Networks beats TEGNA on 9 of the 16 factors compared between the two stocks.

About AMC Networks

AMC Networks Inc. is a holding company, which conducts all of its operations through its subsidiaries. The Company owns and operates entertainment businesses and assets. It operates through two segments: National Networks, and International and Other. National Networks includes activities of its programming businesses, which include its programming networks distributed in the United States and Canada. The International and Other segment includes AMC Networks International (AMCNI), the Company’s international programming businesses consisting of a portfolio of channels in Europe, Latin America, the Middle East and parts of Asia and Africa; IFC Films, the Company’s independent film distribution business; AMCNI- DMC, the broadcast solutions unit of certain networks of AMCNI and third-party networks, and various developing online content distribution initiatives. National Networks’ programming networks include AMC, WE tv, BBC AMERICA and SundanceTV.

About TEGNA

Tegna Inc. has a portfolio of media and digital businesses that provide content. The Company’s segments include TEGNA Media (Media) and TEGNA Digital (Digital). As of December 31, 2016, its media business included 46 television stations operating in 38 markets and offered television programming and digital content. Its Media segment includes core advertising, including local and national non-political advertising; political advertising during elections; retransmission that represents satellite and cable networks, and telecommunications companies to carry its television signals; digital that includes digital marketing services and advertising on the stations’ Websites, tablet and mobile products, and other services. Its Digital business segment consists of three business units, including CareerBuilder, G/O Digital and Cofactor. Its CareerBuilder business units operate in the automotive and human capital solutions industries.

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