NEW YORK – News Corporation, the global media and information services company, has reaffirmed its commitment to its stock repurchase program, according to a recent 8-K filing with the Securities and Exchange Commission.
The company, which is traded on the Nasdaq Global Select Market under the tickers NASDAQ:NWSA for its Class A common stock and NASDAQ:NWS for its Class B common stock, is authorized to repurchase up to $1 billion of its outstanding shares.
In compliance with the rules of the Australian Securities Exchange (ASX), where the company also reports, News Corp (NASDAQ:NWSA) has been providing daily updates on the buyback activities. These updates have been attached as exhibits to the SEC filing. The company’s buyback strategy is part of a broader effort to manage its capital allocation and reward shareholders.
The information provided to the ASX includes forward-looking statements regarding the intention to repurchase shares of both Class A and Class B common stock intermittently. Still, these statements are subject to various factors, including market conditions, the stock's market price, and regulatory requirements, which could influence the company's actions and actual results.
News Corp's decision to continue its repurchase program comes amid a dynamic market environment where companies are increasingly looking to buybacks as a means to utilize excess capital and potentially bolster share value. The company has outlined that any forward-looking statements related to this program are based on current management expectations and could change due to numerous factors.
Investors and stakeholders are reminded that forward-looking statements are not guarantees of future performance and involve risks and uncertainties. The company has stated it does not have any obligation to update these statements, except as required by law.
The filing, dated Thursday, August 1, 2024, provides the latest official insight into News Corp's ongoing financial strategy. The information is based on a press release statement and is intended to keep investors informed about the company's actions in line with regulatory requirements and corporate governance standards.
In other recent news, News Corporation continues to progress with its $1 billion stock repurchase program. The company is buying back Class A and Class B common stock, a move that aligns with its strategy to enhance shareholder value. As part of regulatory requirements, News Corp provides daily updates on the repurchase transactions to the Australian Securities Exchange, ensuring transparency in its capital management initiatives.
On the financial front, News Corp reported a significant 53% increase in free cash flow to $491 million in the third quarter of fiscal year 2024. This positive trend is primarily driven by growth in digital subscriptions and cost savings. Notably, digital revenues now account for over half of the company's total revenue.
In addition to these financial developments, News Corp announced plans for further digital expansion, including The Times of London's venture into the U.S. market. These recent developments indicate News Corp's ongoing shift towards a more digital-focused business model. These are among the recent developments in News Corp's business strategy and financial performance.
InvestingPro Insights
News Corporation's strategic commitment to its stock repurchase program is underscored by its current market capitalization of $15.86 billion, reflecting the scale of the company's operations and investor confidence.
With a P/E ratio adjusted for the last twelve months as of Q3 2024 at 48.65, News Corp's valuation is a critical factor for investors considering the buyback's potential impact on earnings per share. Moreover, the company's revenue of $9.41 billion over the same period, despite a slight decline of 1.77%, shows its substantial financial throughput.
For investors looking at the company's profitability and financial health, News Corp's gross profit margin stands at 49.55%, a robust indicator of its ability to manage costs relative to income. In addition, the company's EBITDA growth of 9.5% showcases its operational efficiency and capacity to generate earnings before interest, taxes, depreciation, and amortization. These metrics, together with a dividend yield of 0.73% as of 2024, paint a picture of a company that is managing to reward its shareholders while navigating the complexities of the global media landscape.
For those seeking further insights and analysis, InvestingPro offers additional tips on News Corporation's financial performance and investment potential. Currently, there are 15 more InvestingPro Tips available for investors who wish to dive deeper into the company's metrics and market position. These tips could provide valuable context for understanding News Corp's stock repurchase program and its implications for shareholder value.
It is worth noting that the InvestingPro Fair Value estimate for News Corp stands at $22.6, which suggests a more conservative outlook compared to the analyst target fair value of $30.5. This disparity may be an essential consideration for investors as they assess the company's stock repurchase program and future financial prospects.
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