First lets consider what News Corp was before the buyout - an old media conglomerate with the lowest ranked of the big 4 networks (Fox), a second stream newspaper (New York Post), a low margin cut throat business in Direct TV and a string of other successful but far from their prime businesses.
With the acquisition of MySpace over a year ago, News Corp made perhaps the single best investment that could have been made by a media company. They paid a mere $580 million for MySpace which pales in comparison to what Google just paid for YouTube.
With anywhere from 20 million to 43 million "active" members (some even whisper 100 million but thats just ludicrous), the News Corp/MySpace relationship resembles the one between Time Warner/AOL - except that MySpace has an exclusive relationship with Google (and now YouTube) and most MySpace users are impressionable teens and twentysomethings.
With analysts touting MySpace's value to be anywhere from $15-20 billion in 3-5 years, this is surely not reflected in the News Corp stock price, which has gone up from about $17.50 to $21.50 since the acquisition. That is a mere 23% gain in almost 15 months. I believe NWS is undervalued at these levels and I recommend buying the stock under 22.
NWS 1-yr chart: