Tegna (NYSE: TGNA) and Netflix (NASDAQ:NFLX) are both consumer discretionary companies, but which is the superior stock? We will contrast the two companies based on the strength of their dividends, earnings, valuation, risk, profitability, institutional ownership and analyst recommendations.
This table compares Tegna and Netflix’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Tegna pays an annual dividend of $0.28 per share and has a dividend yield of 2.5%. Netflix does not pay a dividend. Tegna pays out 13.1% of its earnings in the form of a dividend.
This is a breakdown of recent recommendations and price targets for Tegna and Netflix, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Tegna presently has a consensus price target of $15.75, suggesting a potential upside of 39.75%. Netflix has a consensus price target of $249.74, suggesting a potential downside of 17.01%. Given Tegna’s higher probable upside, research analysts plainly believe Tegna is more favorable than Netflix.
Earnings & Valuation
This table compares Tegna and Netflix’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Tegna||$1.90 billion||1.28||$273.74 million||$2.13||5.29|
|Netflix||$11.69 billion||11.17||$558.92 million||$1.25||240.75|
Netflix has higher revenue and earnings than Tegna. Tegna is trading at a lower price-to-earnings ratio than Netflix, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
99.9% of Tegna shares are held by institutional investors. Comparatively, 81.6% of Netflix shares are held by institutional investors. 0.4% of Tegna shares are held by insiders. Comparatively, 4.9% of Netflix shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Volatility & Risk
Tegna has a beta of 1.55, suggesting that its stock price is 55% more volatile than the S&P 500. Comparatively, Netflix has a beta of 0.96, suggesting that its stock price is 4% less volatile than the S&P 500.
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 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 includes G/O Digital and Cofactor.
Netflix, Inc. is a provider an Internet television network. The Company operates through three segments: Domestic streaming, International streaming and Domestic DVD. The Domestic streaming segment includes services that streams content to its members in the United States. The International streaming segment includes services that streams content to its members outside the United States. The Domestic DVD segment includes services, such as digital optical disc (DVD)-by-mail. The Company’s members can watch original series, documentaries, feature films, as well as television shows and movies directly on their Internet-connected screen, televisions, computers and mobile devices. It offers its streaming services both domestically and internationally. In the United States, its members can receive DVDs delivered to their homes. The Company had members streaming in over 190 countries, as of December 31, 2016.
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