What to Expect From News Corporation's Earnings Report Tuesday

| About: News Corporation (NWS)

News Corporation (NASDAQ:NWS) is a $38.63 billion market cap company that trades an average of 52.49 million shares per day. Analysts are expecting an improvement of $0.04 in earnings per share compared to last quarter's results of $0.26. The company was founded in 1922 and is based in New York, New York.

  • Time Released: After Closing Bell
  • Industry: Printing & Publishing
  • Recent Price: $14.50
  • 52 Week High: $18.35
  • 52 Week Low: $11.91
  • Book Value: $10.82

Next quarter estimated mean earnings are $0.30 per share. Analyst estimates range between $0.27 and $0.31 per share.

The earnings are likely to continue to be overshadowed by the wiretapping scandal. The latest news is that Rupert Murdoch's daughter Elisabeth will not be joining News Corp's board. The stock is holding up well, and this whole thing will likely be largely forgotten about, just as the BP spill stock sell off has largely vanished.

Revenue year-over-year has increased from $32.78 billion for 2010 vs. $30.42 billion for 2009. The bottom line has rising earnings year-over-year of $2 million for 2010 vs. $-3 million for 2009. The company's earnings before income and taxes are rising with an EBIT year-over-year of $3 million for 2010 vs. $-5 million for 2009.

I believe that if the numbers come in as expected, and the next quarters numbers do as well, the company should be bought on dips. Currently August is the most active call options at the $16 strike price. For put options, it's almost a tie between the $14, $15, and $16 strike price. The published spreads are rather wide, but bids and offers in the middle are getting filled. If you do want to buy price protection, don't pay the offer, but rather make a bid in the mid-price or close to the offer and save yourself some of the spread.

Revenue growth is at an annual rate of 7.74%.

Gross reported revenue compared to the mean estimate (rounded).

Fiscal Quarter Ending Month-Year Revenue Estimates Actual $ Difference Difference %
Mar-11 $ 8.42 b $ 8.26B $ -159.10M -1.89%
Dec-10 $ 8.72 b $ 8.76B $ 43.64M 0.5%
Sep-10 $ 7.43 b $ 7.43B $ 0.99M 0.01%
Jun-10 $ 7.91 b $ 8.11B $ 199.81M 2.53%
Mar-10 $ 8.17 b $ 8.79B $ 610.87M 7.47%

M = millions, B = billions

Reported earnings per share compared to the mean estimate. Differences are rounded.

Fiscal Quarter Ending Month-Year Estimate Actual Difference Difference %
Mar-11 0.27 0.26 -0.01 -3.7%
Dec-10 0.28 0.29 0.01 3.57%
Sep-10 0.24 0.27 0.03 12.5%
Jun-10 0.20 0.3 0.1 50%
Mar-10 0.22 0.29 0.07 31.82%

(Some onetime items are often excluded in reported EPS)

I use a proprietary blend of technical analysis, financial crowd behavior, and fundamentals in my short-term trades, and while not totally the same in longer swing trades to investments, the concepts used are similar. You may want to use this article as a starting point of your own research with your financial planner. I use Seeking Alpha, Edgar Online, Google Finance, MSN Money, CNBC, Zacks and Yahoo Finance for most of my data.

I use the "confirmed" symbols from earnings.com that I believe to be of the most interest. I also often include some that are not "confirmed" but are "Proposed" for the same day. The numbers are only as good as the sources. Many of the ADRs that are relatively new provide a special challenge that can be very time consuming to figure out the "best" number. Chinese ADRs that are new seem to be especially prone to conflicts with Reuters, EDGAR Online, and other sources. Not everyone puts companies into the same sector. I use Reuters as my primary guide to keep it consistent.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.