Entravision Communications Corporation (NYSE: EVC) and Nexstar Broadcasting Group (NASDAQ:NXST) are both consumer discretionary companies, but which is the better business? We will compare the two businesses based on the strength of their profitabiliy, valuation, institutional ownership, dividends, risk, analyst recommendations and earnings.

Dividends

Entravision Communications Corporation pays an annual dividend of $0.13 per share and has a dividend yield of 1.9%. Nexstar Broadcasting Group pays an annual dividend of $1.20 per share and has a dividend yield of 1.9%. Entravision Communications Corporation pays out 56.5% of its earnings in the form of a dividend. Nexstar Broadcasting Group pays out 51.5% 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 Broadcasting Group has increased its dividend for 3 consecutive years.

Valuation and Earnings

This table compares Entravision Communications Corporation and Nexstar Broadcasting Group’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Entravision Communications Corporation $257.91 million 2.40 $64.55 million $0.23 29.78
Nexstar Broadcasting Group $1.39 billion 2.19 $488.14 million $2.33 27.70

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

Institutional & Insider Ownership

64.2% of Entravision Communications Corporation shares are held by institutional investors. 20.7% of Entravision Communications Corporation shares are held by company insiders. Comparatively, 7.8% of Nexstar Broadcasting Group shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Entravision Communications Corporation and Nexstar Broadcasting Group, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Entravision Communications Corporation 0 2 1 0 2.33
Nexstar Broadcasting Group 0 0 7 0 3.00

Entravision Communications Corporation presently has a consensus price target of $7.00, suggesting a potential upside of 2.19%. Nexstar Broadcasting Group has a consensus price target of $78.86, suggesting a potential upside of 22.16%. Given Nexstar Broadcasting Group’s stronger consensus rating and higher possible upside, analysts plainly believe Nexstar Broadcasting Group is more favorable than Entravision Communications Corporation.

Risk and Volatility

Entravision Communications Corporation has a beta of 1.51, meaning that its stock price is 51% more volatile than the S&P 500. Comparatively, Nexstar Broadcasting Group has a beta of 2.3, meaning that its stock price is 130% more volatile than the S&P 500.

Profitability

This table compares Entravision Communications Corporation and Nexstar Broadcasting Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Entravision Communications Corporation 8.05% 11.53% 3.97%
Nexstar Broadcasting Group 5.47% 24.33% 3.04%

Summary

Nexstar Broadcasting Group beats Entravision Communications Corporation on 10 of the 17 factors compared between the two stocks.

Entravision Communications Corporation Company Profile

Entravision Communications Corporation is a media company. The Company reaches and engages Hispanics in the United States and certain border markets of Mexico across media channels and advertising platforms. The Company operates through three segments: television broadcasting, radio broadcasting and digital media. As of December 31, 2016, the Company owned and operated 54 television stations located primarily in California, Colorado, Connecticut, Florida, Kansas, Massachusetts, Nevada, New Mexico, Texas and Washington, District of Columbia. It owns and operates Spanish-language radio stations in the United States. As of December 31, 2016, its radio stations consisted of 38 frequency modulation (FM) and 11 amplitude modulation (AM) stations located in Arizona, California, Colorado, Florida, Nevada, New Mexico and Texas. The digital media segment provides digital advertising solutions that allow advertisers to reach online Hispanic audiences throughout the United States and Mexico.

Nexstar Broadcasting Group Company Profile

Nexstar Media Group, Inc., formerly Nexstar Broadcasting Group, Inc., is a television broadcasting and digital media company. The Company is focused on the acquisition, development and operation of television stations and interactive community Websites, and digital media services in medium-sized markets in the United States. The Company’s segments include Broadcasting and Other. The Company’s broadcast segment includes television stations and related community-focused Websites that it owns, operates, programs or provides sales and other services to in various markets across the United States. The other activities of the Company include corporate functions, eliminations and other operations. As of December 31, 2016, it owned, operated, programmed or provided sales and other services to 104 full power television stations in 62 markets in the states of Alabama, Arizona, Arkansas, California, Colorado, Florida, New York, Utah, Vermont, Virginia, West Virginia and Wisconsin, among others.

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