Critical Analysis: TEGNA (TGNA) and AMC Networks (AMCX)
TEGNA (NYSE: TGNA) and AMC Networks (NASDAQ:AMCX) are both mid-cap consumer discretionary companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, risk, analyst recommendations, earnings, valuation, profitabiliy and dividends.
TEGNA pays an annual dividend of $0.28 per share and has a dividend yield of 1.8%. AMC Networks does not pay a dividend. TEGNA pays out 15.0% of its earnings in the form of a dividend.
Volatility and Risk
TEGNA has a beta of 1.79, indicating that its stock price is 79% more volatile than the S&P 500. Comparatively, AMC Networks has a beta of 0.96, indicating that its stock price is 4% less volatile than the S&P 500.
Earnings & Valuation
This table compares TEGNA and AMC Networks’ top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|TEGNA||$3.34 billion||0.98||$1.16 billion||$1.87||8.16|
|AMC Networks||$2.77 billion||1.34||$845.29 million||$4.14||13.49|
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
86.6% of TEGNA shares are held by institutional investors. Comparatively, 81.7% of AMC Networks shares are held by institutional investors. 0.8% of TEGNA shares are held by company insiders. Comparatively, 17.7% of AMC Networks shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
This table compares TEGNA and AMC Networks’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a breakdown of recent recommendations and price targets for TEGNA and AMC Networks, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
TEGNA currently has a consensus target price of $23.31, indicating a potential upside of 52.77%. AMC Networks has a consensus target price of $60.58, indicating a potential upside of 8.48%. Given TEGNA’s stronger consensus rating and higher possible upside, equities research analysts clearly believe TEGNA is more favorable than AMC Networks.
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 digital business consists of its Cars.com and CareerBuilder business units that operate in the automotive and human capital solutions industries. 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 four business units, including Cars.com, CareerBuilder, G/O Digital and Cofactor.
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.
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