84.03 -0.96 (-1.14%) Buy

Don't consider investing in NXST now, it is risky at the moment

13 min read

NXST was among the worst performers today. On a longer term basis, investors in NEXSTAR MEDIA GROUP, INC. made -0.1% per day. Monday's performance of -1.14% was a significant underperformance compared to it's daily average.

[Themes containing NXST]

NXST showed a up trend over the last 3 months. During this period NXST gained +4.71% and saw a maximum drawdown of -14.35%. It has been unusually choppy during this period. Long term investors are better off avoiding investing in NXST till volatility reduces and a clear trend emerges.


NXST has been outperforming the SP500 index in recent time. Over the last 2 years 11 months and 10 days, NXST outperformed the SP500 index on 50% days. Which indicates that on days NXST outperforms the SP500 index, it's performance is marginally better than on the days it underperforms the SP500 index.

NXST was profitable on 56% days in the last three months. During this time, it delivered on average +0.1% per day. It delivered it's best daily return of +6.87%, during this period, on Monday, 3 Dec, 2018. There was initially a bearish trend during this period which started on 9 Oct, 2018 and went on till 11 Oct, 2018. The trend delivered -8.39% losses to investors. This was followed by a bullish trend that started on 29 Oct, 2018 and ended on 7 Nov, 2018. This bullish trend delivered +14.43% to investors.

On monthly basis, NXST delivered profits and losses in equal number of months. NXST delivered profits less regularly than SP500 index. NXST significantly outperformed SP500 index in Jun 2018, when it returned +10.71% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. NXST had a shorter streak of profitable months than SP500 index. It only went up in 4 straight months during the last year.

Investment philosophy is the clear understanding that by owning shares of stocks he owns businesses, not pieces of paper.
-- Warren Edward Buffett

NXST is becoming less volatile overall. In comparison, the SP500 index is seeing a rise in volatility. During the last three months, there was a significant surge in NXST's volatility from 19 Sep, 2018 to 7 Dec, 2018. While there was a significant surge in the SP500 index's volatility from 19 Sep, 2018 to 29 Oct, 2018.

Advanced/professional short-term investors should note that NXST has negative skewness in it's return distribution. This indicates that investors may need to stay invested through long periods of drawdown before expecting a recovery.

NXST has more chance of extreme outcomes than the SP500 index. Therefore, NXST must receive a lower allocation than SP500 in your portfolio. SP500 index usually has shorter drawdown period than NXST.

Based on your interest in NXST you may find it interesting to know that TREX and ILMN have both performed similar to NXST and can be considered by investors as alternative investment options.

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