TGNA - Embedded Expectations Analysis - 2020 01 24
TEGNA Inc. (TGNA:USA) currently trades below corporate averages relative to UAFRS-based (Uniform) Earnings with an 11.4x Uniform P/E. At these levels, the market has bearish expectations for the firm, and management appears concerned about M&A transactions and opportunities, subscriber declines, and advertisement revenue.Specifically, management may lack confidence in their ability to improve the performance of their recently acquired stations and find additional capital efficient M&A opportunities. Moreover, they may be exaggerating the benefits of being a long-term consolidator, the quality of their reputation among independent broadcasters, and the efficiency of their cap space use. Furthermore, they may be concerned about the progress of subscriber and distributor renegotiations, declines in their retransmission subs, and weakness in auto and retail ad revenue. Finally, management may be overstating their ad performance in larger markets, and they may lack confidence in their ability to sustain high-quality content growth.
TEGNA is a media company. The company's business provides television programming and digital content. Each television station also has a digital presence across online, mobile and social platforms. The company provides advertising and marketing services, which include local and national non-political television advertising, digital marketing services, and advertising on stations' websites and tablet and mobile products; subscription by satellite, cable, Over the Top and telecommunications providers; political advertising; and other services, such as production of programming and advertising material. The company's portfolio of Big 4 NBC, CBS, ABC and FOX stations operate under long-term affiliation agreements.
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