It has been about a month since the last earnings report for TEGNA Inc. (TGNA Quick QuoteTGNA - Free Report) . Shares have lost about 0.3% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is TEGNA Inc. due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

TEGNA Q1 Earnings Match Estimates, Revenues Rise Y/Y

TEGNA’s first-quarter 2021 non-GAAP earnings of 52 cents per share came in line with the Zacks Consensus Estimate. The bottom line increased 20.9% on a year-over-year basis.

Revenues increased 6.3% year over year to $727.1 million and beat the consensus mark by 0.01%. This year-over-year growth was driven by continued growth in subscription revenues and record first-quarter advertising and marketing services revenues.

Quarter in Detail

Advertising and Marketing services (44.4% of revenues) revenues increased 9.4% year over year to $322.8 million. Revenues of Premion, TEGNA’s OTT advertising business, were up over 50% year over year.

Subscription (53.2% of revenues) revenues increased 16.2% year over year to $386.7 million due to rate increases, partially offset by subscriber declines.

Political (1.3% of revenues) revenues were $9.4 million, down 80.1% year over year

Other revenues (1.1% of revenues) were $8.1 million, down 9% year over year.

Non-GAAP adjusted EBITDA increased 8.7% year over year to $230.8 million. Adjusted EBITDA margin expanded 70 basis points (bps) to 31.7%. Adjusted EBITDA growth reflects strong operational performance of TEGNA’s stations including ongoing cost efficiency efforts, in addition to continued growth in subscription revenues and strong AMS revenues.

Non-GAAP operating expenses (72.6% of revenues) of $527.9 million were up 4.6% year over year, primarily on account of higher programming expenses in relation to an increase in subscription revenues.

Non-GAAP operating income increased 11.1% year over year to $199.1 million. Operating margin expanded 120 bps to 27.4%.

Balance Sheet & Cash Flow

As of Mar 31, 2021, total cash was $13 million compared with $41 million as of Dec 31, 2020.

Total debt was $3.5 billion and net leverage was 3.82 times as of Mar 31, 2021.

Free cash flow in the first quarter was $158.7 million, up 11.6% year over year.

Guidance

For the second quarter of 2021, TEGNA expects GAAP revenues to be more than mid-to-high twenties percent. Non-GAAP operating expenses are expected to increase in low-double digits percent.

For 2021, TEGNA expects net subscription profits to grow in the mid-to-high teens percentage range.

The company expects free cash flow as a percentage of 2020-2021 revenues of 21%- 22%.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed an upward trend in fresh estimates. The consensus estimate has shifted 28.2% due to these changes.

VGM Scores

At this time, TEGNA Inc. has an average Growth Score of C, though it is lagging a bit on the Momentum Score front with a D. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of this revision looks promising. It comes with little surprise TEGNA Inc. has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.