Is NXST Stock A Buy or Sell?

Our extensive research has shown that imitating the smart money can generate significant returns for retail investors, which is why we track nearly 900 active prominent money managers and analyze their quarterly 13F filings. The stocks that are heavily bought by hedge funds historically outperformed the market, though there is no shortage of high profile failures like hedge funds’ 2018 losses in Facebook and Apple. Let’s take a closer look at what the funds we track think about Nexstar Media Group, Inc. (NASDAQ:NXST) in this article.

Is NXST stock a buy or sell? The smart money was in an optimistic mood. The number of long hedge fund bets inched up by 3 in recent months. Nexstar Media Group, Inc. (NASDAQ:NXST) was in 44 hedge funds’ portfolios at the end of December. The all time high for this statistic is 50. Our calculations also showed that NXST isn’t among the 30 most popular stocks among hedge funds (click for Q4 rankings).


Seth Klarman of Baupost Group

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Do Hedge Funds Think NXST Is A Good Stock To Buy Now?

At fourth quarter’s end, a total of 44 of the hedge funds tracked by Insider Monkey were long this stock, a change of 7% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards NXST over the last 22 quarters. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

Of the funds tracked by Insider Monkey, Baupost Group, managed by Seth Klarman, holds the number one position in Nexstar Media Group, Inc. (NASDAQ:NXST). Baupost Group has a $227.7 million position in the stock, comprising 2.1% of its 13F portfolio. Sitting at the No. 2 spot is Amy Minella of Cardinal Capital, with a $125 million position; 3.6% of its 13F portfolio is allocated to the company. Some other members of the smart money with similar optimism include Ken Griffin’s Citadel Investment Group, Claus Moller’s P2 Capital Partners and Peter S. Park’s Park West Asset Management. In terms of the portfolio weights assigned to each position Calixto Global Investors allocated the biggest weight to Nexstar Media Group, Inc. (NASDAQ:NXST), around 12.5% of its 13F portfolio. Simcoe Capital Management is also relatively very bullish on the stock, designating 6.94 percent of its 13F equity portfolio to NXST.

As aggregate interest increased, some big names were leading the bulls’ herd. Zimmer Partners, managed by Stuart J. Zimmer, assembled the largest position in Nexstar Media Group, Inc. (NASDAQ:NXST). Zimmer Partners had $5.5 million invested in the company at the end of the quarter. Felix Wai’s Zeno Research also initiated a $2 million position during the quarter. The other funds with brand new NXST positions are Michael Rockefeller and Karl Kroeker’s Woodline Partners, Paul Marshall and Ian Wace’s Marshall Wace LLP, and Jinghua Yan’s TwinBeech Capital.

Let’s check out hedge fund activity in other stocks similar to Nexstar Media Group, Inc. (NASDAQ:NXST). These stocks are Ashland Global Holdings Inc.. (NYSE:ASH), Flowserve Corporation (NYSE:FLS), Flowers Foods, Inc. (NYSE:FLO), Boyd Gaming Corporation (NYSE:BYD), Synovus Financial Corp. (NYSE:SNV), Pilgrim’s Pride Corporation (NASDAQ:PPC), and Penske Automotive Group, Inc. (NYSE:PAG). This group of stocks’ market valuations match NXST’s market valuation.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
ASH 38 1114289 -8
FLS 21 148236 2
FLO 27 289063 -3
BYD 28 275982 0
SNV 33 157470 8
PPC 17 80484 -1
PAG 21 114199 3
Average 26.4 311389 0.1

View table here if you experience formatting issues.

As you can see these stocks had an average of 26.4 hedge funds with bullish positions and the average amount invested in these stocks was $311 million. That figure was $891 million in NXST’s case. Ashland Global Holdings Inc.. (NYSE:ASH) is the most popular stock in this table. On the other hand Pilgrim’s Pride Corporation (NASDAQ:PPC) is the least popular one with only 17 bullish hedge fund positions. Compared to these stocks Nexstar Media Group, Inc. (NASDAQ:NXST) is more popular among hedge funds. Our overall hedge fund sentiment score for NXST is 84.4. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. Our calculations showed that top 30 most popular stocks among hedge funds returned 81.2% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 26 percentage points. These stocks returned 5.3% in 2021 through March 19th but still managed to beat the market by 0.8 percentage points. Hedge funds were also right about betting on NXST as the stock returned 41.8% since the end of December (through 3/19) and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.

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Disclosure: None. This article was originally published at Insider Monkey.