We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
TEGNA’s (TGNA - Free Report) fourth-quarter 2022 non-GAAP earnings of 98 cents per share beat the Zacks Consensus Estimate by 8.89% and increased 71.9% on a year-over-year basis.
Revenues increased 18.4% year over year to $917.1 million but missed the consensus mark by 1.17%. The year-over-year growth was driven by strong growth in political revenues, despite a decline in advertising and marketing services revenues, resulting from political displacement and macroeconomic headwinds.
Notably, in February, Tegna entered into a definitive agreement to be acquired by an affiliate of Standard General for $24 per share in cash and become a private company. The transaction, which was unanimously approved by the Tegna board, has an equity value of around $5.4 billion and an enterprise value of $8.6 billion, including the assumption of debt.
On Nov 18, TEGNA announced that Standard General’s acquisition of Tegna received approval from Team Telecom, which submitted a filing with the Federal Communications Commission (FCC) confirming it has no objections to the transaction.
However, recently, the FCC put off consideration of the proposed purchase raising concerns that the transaction might trigger price increases for consumers as TV stations boost charges for cable providers. The deal might also reduce local content on TV stations.
Subscription (40.6% of revenues) revenues increased 10.8% year over year to $372.3 million, driven by rate increases and partially offset by subscriber declines. TEGNA has renewed retransmission consent agreements representing approximately 30% of its subscribers since prior quarter.
Advertising and Marketing services (38.5% of revenues) revenues decreased 11.8% year over year to $352.9 million due to displacement because of strong political revenues, continued macroeconomic headwinds and reduced sports betting advertising with fewer new market launches from the prior year. Automotive advertising revenues rebounded in the quarter with strong year-over-year growth.
Political (19.6% of revenues) revenues were $179.4 million, up from $26.6 million reported in the year-ago quarter.
Other revenues (1.4% of revenues) were $12.5 million, up 4.1% year over year.
Non-GAAP adjusted EBITDA increased 47.1% year over year to $360.7 million. Adjusted EBITDA margin expanded 770 basis points (bps) from the year-ago period to 39.3%.
Non-GAAP operating expenses (64% of revenues) of $586.5 million were up 4.5% year over year, with increases predominantly driven by investments in Premion’s growth and programing costs.
Non-GAAP operating income increased 55% year over year to $330.6 million. The operating margin expanded 850 bps from the year-ago period to 36%.
Balance Sheet & Cash Flow
As of Dec 31, 2022, total cash was $551.7 million compared with $377 million as of Sep 30, 2022.
Total debt was $3.09 billion and net leverage was 2.7 times as of Dec 31, 2022.
Free cash flow in the fourth quarter was $297.1 million compared with $148.4 million reported in the previous quarter.
Zacks Rank & Stocks to Consider
TEGNA currently has a Zacks Rank #5 (Strong Sell).
Image: Bigstock
TEGNA (TGNA) Q4 Earnings Beat Estimates, Revenues Rise Y/Y
TEGNA’s (TGNA - Free Report) fourth-quarter 2022 non-GAAP earnings of 98 cents per share beat the Zacks Consensus Estimate by 8.89% and increased 71.9% on a year-over-year basis.
Revenues increased 18.4% year over year to $917.1 million but missed the consensus mark by 1.17%. The year-over-year growth was driven by strong growth in political revenues, despite a decline in advertising and marketing services revenues, resulting from political displacement and macroeconomic headwinds.
Notably, in February, Tegna entered into a definitive agreement to be acquired by an affiliate of Standard General for $24 per share in cash and become a private company. The transaction, which was unanimously approved by the Tegna board, has an equity value of around $5.4 billion and an enterprise value of $8.6 billion, including the assumption of debt.
On Nov 18, TEGNA announced that Standard General’s acquisition of Tegna received approval from Team Telecom, which submitted a filing with the Federal Communications Commission (FCC) confirming it has no objections to the transaction.
However, recently, the FCC put off consideration of the proposed purchase raising concerns that the transaction might trigger price increases for consumers as TV stations boost charges for cable providers. The deal might also reduce local content on TV stations.
TEGNA Inc. Price, Consensus and EPS Surprise
TEGNA Inc. price-consensus-eps-surprise-chart | TEGNA Inc. Quote
Quarter in Detail
Subscription (40.6% of revenues) revenues increased 10.8% year over year to $372.3 million, driven by rate increases and partially offset by subscriber declines. TEGNA has renewed retransmission consent agreements representing approximately 30% of its subscribers since prior quarter.
Advertising and Marketing services (38.5% of revenues) revenues decreased 11.8% year over year to $352.9 million due to displacement because of strong political revenues, continued macroeconomic headwinds and reduced sports betting advertising with fewer new market launches from the prior year. Automotive advertising revenues rebounded in the quarter with strong year-over-year growth.
Political (19.6% of revenues) revenues were $179.4 million, up from $26.6 million reported in the year-ago quarter.
Other revenues (1.4% of revenues) were $12.5 million, up 4.1% year over year.
Non-GAAP adjusted EBITDA increased 47.1% year over year to $360.7 million. Adjusted EBITDA margin expanded 770 basis points (bps) from the year-ago period to 39.3%.
Non-GAAP operating expenses (64% of revenues) of $586.5 million were up 4.5% year over year, with increases predominantly driven by investments in Premion’s growth and programing costs.
Non-GAAP operating income increased 55% year over year to $330.6 million. The operating margin expanded 850 bps from the year-ago period to 36%.
Balance Sheet & Cash Flow
As of Dec 31, 2022, total cash was $551.7 million compared with $377 million as of Sep 30, 2022.
Total debt was $3.09 billion and net leverage was 2.7 times as of Dec 31, 2022.
Free cash flow in the fourth quarter was $297.1 million compared with $148.4 million reported in the previous quarter.
Zacks Rank & Stocks to Consider
TEGNA currently has a Zacks Rank #5 (Strong Sell).
Some better-ranked stocks in the Consumer Discretionary sector are Six Flags Entertainment , BJ's Wholesale Club (BJ - Free Report) and Sportradar Group (SRAD - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Six Flags Entertainment, BJ's Wholesale Club and Sportradar Group are scheduled to report quarterly results on Mar 2, Mar 9 and Mar 15, respectively.
The Zacks Consensus Estimate for SIX’s fourth-quarter 2022 earnings is pegged at 23 cents per share, unchanged over the past 30 days.
The Zacks Consensus Estimate for BJ's fourth-quarter 2022 earnings is pegged at 88 cents per share, unchanged over the past 30 days.
The Zacks Consensus Estimate for SRAD’s fourth-quarter 2022 earnings is pegged at 3 cents per share, unchanged over the past 30 days.