News Corp: Near 52-Week Low Again Despite Solid FY22

Sep. 26, 2022 5:29 PM ETNews Corporation (NWS), NWSA
Librarian Capital profile picture
Librarian Capital
7.85K Followers

Summary

  • News Corp shares are again near their 52-week low and down 37% in the past year, with Class A shares trading at 12.5x FY22 EPS.
  • Operational performance has continued to be solid, with Q4 providing a mostly strong finish to FY22, despite investor macro concerns.
  • We continue to expect EBIT to grow at mid-to-high single-digits, led by high-quality assets in Dow Jones and Digital Real Estate Services.
  • News Corp's 61% stake in REA is still worth 70% of its market capitalization, leaving a 20%+ Free Cash Flow Yield for the rest.
  • We believe investors can expect a 20-30% upside, either by going long News Corp or a pair trade of long News Corp, short REA.
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Kevin Hagen

Introduction

We review our Buy rating on News Corp (NASDAQ:NWSA) after shares are again near their 52-week low.

We initiated our Buy rating on News Corp in early July. Since then Class A shares (which we preferred) are down 2%, taking them back to

This article was written by

Librarian Capital profile picture
7.85K Followers
Global, long-term, fundamentally-oriented & concentrated investing. With more than 10 years' buy-side experience, I look at stocks globally and across industries, with a focus on the U.S. and U.K.. My investing style can best be described as "Quality Growth" or "Growth At a Reasonable Price". (previously writing under the name "Blue Sky Capital" until December 2019)

Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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