Why This Fox Analyst Downgrades Stock, Even As Murdoch Contemplates Merger With News Corp


Shares of Fox Corp FOXA have been in focus following reports of Rupert Murdoch weighing a merger of the company with News Corp NWSA.

While there are catalysts in fiscal 2023, they are already reflected in the company’s stock valuation, according to Wolfe Research.

The Fox Corp Analyst: Peter Supino downgraded the rating for Fox Corp from Peer Perform to Underperform, while maintaining the price target at $28.

The Fox Corp Thesis: At 43%, the company has high revenue exposure to advertising, which should be impacted by a severe macro downturn, Supino said in the downgrade note.

Check out other analyst stock ratings.

Fox faces a “competitive disadvantage” with an acceleration in streaming and has “no place to hide in new ecosystem, even for news & sports,” the analyst wrote. “Fox News over-earns in linear – replacement economics not feasible in DTC due to price point needed,” he added.

“FanDuel value unlock anticlimactic – arbitration value at $20B (+5% p.a. escalator) vs. hoped for $35B+,” Supino further stated.

FOXA Price Action: Shares of Fox Corp had declined by 0.69% to $30.16 at the time of publication Tuesday.

Also Read: Bloomberg Disowns Reports Of Acquisition Plans For Dow Jones And Washington Post

Photo: courtesy of Shutterstock.

Market News and Data brought to you by Benzinga APIs
Price Target
Posted In: Analyst ColorDowngradesAnalyst RatingsPeter SupinoWolfe Research
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!