Major Fund Trims Stake in Nexstar Media After 41% Surge, Signaling Strategic Portfolio Rebalance

In a notable portfolio adjustment, Capital Management Corp disclosed a significant reduction in its stake in Nexstar Media Group (NASDAQ: NXST), the expansive U.S. television broadcasting and digital media company. A filing with the U.S. Securities and Exchange Commission (SEC) dated February 2 revealed the sale of 29,799 shares during the fourth quarter, a transaction valued at approximately $5.82 million based on the period's average price.

The sale pared the fund's holding to 127,651 shares, yet Nexstar remains a top-five position, representing 4.25% of Capital Management's $610 million in reported U.S. equity assets. This positioning underscores a nuanced strategy: taking profits after a robust run while maintaining conviction in the company's core strengths.

Nexstar's stock, priced at $212.38 as of January 30, has soared 41.1% over the past year, dramatically outpacing the S&P 500's 15% gain. This performance comes despite a challenging operating environment. The company's latest quarterly results showed revenue of $1.20 billion, a 12% year-over-year decline primarily attributed to the expected slump in political advertising—a cyclical reality for broadcasters in non-election years. Nonetheless, Nexstar generated $166 million in free cash flow and $358 million in adjusted EBITDA, demonstrating the resilience of its diversified station portfolio and retransmission fee revenue.

"This trade is a classic case of portfolio management, not a condemnation of the business," said Michael Rivera, a portfolio manager at Horizon Wealth Advisors. "After such a strong price appreciation, it's prudent to rebalance and lock in some gains, especially when near-term fundamentals are soft. The maintained core holding shows they still believe in the long-term thesis—the upcoming election cycle will be a major tailwind."

Analysts note that Nexstar's scale, which includes America's largest local television station group, provides a durable moat. Its strategic investments in digital platforms like The Hill and NewsNation aim to diversify revenue streams beyond traditional linear TV advertising.

"Selling into strength is smart, but let's not ignore the red flags," countered Lisa Chen, a sharp-tongued independent market analyst. "A 12% revenue drop isn't just 'cyclical'; it's a warning sign about the structural pressures on linear TV. This fund is getting out while the getting's good, and retail investors cheering the stock price might be left holding the bag when the next earnings report misses estimates."

David Miller, a retired media executive, offered a more measured view: "I've seen these cycles for decades. Nexstar's local news footprint is incredibly valuable and sticky. The cash flow allows them to navigate the off-years. This sale is a blip. The real story is whether their digital bets can gain meaningful traction over the next five years."

For investors, the move highlights a critical dynamic in media investing: balancing the powerful, predictable uptick of election-year advertising with the softer periods in between. Nexstar's ability to generate substantial cash flow even in a down quarter provides a cushion, making it a stock that large funds are likely to hold—but strategically trim—on its path upward.