Shares of television broadcasting company Sinclair Broadcast Group (NASDAQ:SBGI) fell sharply on Wednesday, declining as much as 16.6%. As of 3:15 p.m. EST, the stock was down about 15.3%.
The stock's decline follows Sinclair's fourth-quarter results, which conclude a transformational year for the company. In 2019, Sinclair acquired 21 regional sports networks from Walt Disney (NYSE:DIS).
A sharp decline in profits, however, may have disappointed some investors.
Sinclair's fourth-quarter revenue jumped 82% year over year to $1.6 billion. This was attributable to Sinclair's recently acquired assets. But political revenue was down from $150 million in the fourth quarter of 2018 to $23 million in the fourth quarter of 2019. This tough comparison is due to 2018 being an election year.
A sharp decline in political revenue weighed on profitability. Net income in the fourth quarter of 2018 was $44 million, down from $206 million in the year-ago period.
Sinclair guided for first-quarter revenue between $1.647 billion and $1.675 billion. This compares to an analyst estimate for revenue of $1.66 billion.
Management is optimistic about Sinclair's opportunities.
"As the owner of the largest group of regional sports networks (RSNs) and a leading provider of local news, Sinclair is well-positioned to capitalize on the most desirable segments of the broadcast and media industry -- live local content that resonates with viewers," said Sinclair CEO Chris Ripley in the company's fourth-quarter earnings release. Ripley also said the company will focus on growing its share of "what is believed to be unprecedented political advertising spending" in 2020.