On Wednesday, Loop Capital has increased its price target for FOX Corp. (NASDAQ: FOXA) shares, moving the figure up to $55.00 from the previous $48.00. The stock, currently trading at $49.07 and near its 52-week high of $49.30, has delivered impressive returns with a 68% gain year-to-date.
The firm has also reiterated its Buy rating on the stock. The adjustment comes as a response to the company's performance, which has been bolstered by robust ratings and advertising revenue.
FOX Corp. has been identified as Loop Capital's top media pick for the year 2024, a decision based on the company's strategic focus on news and sports programming. According to InvestingPro data, the company maintains strong financial health with a current ratio of 2.59 and operates with moderate debt levels.
This focus has allowed FOX to steer clear of the expensive competition in the streaming sector while maintaining what is considered an inexpensive valuation. The company's financial estimates for fiscal years 2025 and 2026 have been raised in light of these factors.
The media giant has seen a surge in political advertising and has experienced a notable increase in Fox News ratings and market share post-election. The broadcast network also gained from airing the World Series, which featured a matchup between the Yankees and the Dodgers, alongside strong ratings for college and NFL football broadcasts. Looking ahead, FOX is set to broadcast the Super Bowl in February, which is anticipated to further strengthen its advertising revenue.
Despite the expansion of the stock's multiple, Loop Capital views the stock as undervalued, trading at 6.5 times the estimated EBITDA for 2024/2025. This perspective aligns with InvestingPro analysis, which shows FOX trading at an attractive P/E ratio of 11.35x and generating $3.026B in EBITDA.
The firm's stance remains bullish, as indicated by the sustained Buy rating. For deeper insights into FOX's valuation and 12 additional ProTips, including dividend history and profitability metrics, explore the comprehensive Pro Research Report available on InvestingPro.
In other recent news, Fox Corporation has seen a series of notable developments. Citi has raised its price target for Fox Corp (NASDAQ:FOXA) from $50 to $58, maintaining a Buy rating, as it updates its model in anticipation of the company's second quarter fiscal year 2025 results. The firm's decision reflects a more optimistic valuation framework, factoring in the company's future potential.
Fox Corporation reported an 11% increase in total revenues for the first quarter of fiscal year 2025, reaching $3.56 billion. The EBITDA also rose by 21%, crossing the $1 billion mark, while the net income reached $827 million. These robust results were largely driven by high audience engagement across Fox News and sports programming.
Moreover, Fox Corporation's Annual Meeting of Stockholders saw the election of several directors and the ratification of Ernst & Young LLP as the company's independent auditor for the upcoming fiscal year. The shareholders also approved, on an advisory and nonbinding basis, the compensation of named executive officers.
Fox Corporation's streaming service, Tubi, reported a revenue growth of 19%, and is projected to exceed $1 billion for the fiscal year. Despite challenges such as a decline in NFL advertising revenue and increased sports rights fees, the company's executives have expressed optimism about improving subscriber trends and the political advertising landscape.
These are recent developments that highlight the ongoing financial performance and market position of Fox Corporation.
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