) is diversifying its business model by adding new revenue
streams in an effort to adapt to the changing face of the
multiplatform media universe. These endeavors have helped this
media conglomerate to attain a new 52-week high of $27.94 on
Monday, before closing at $27.56. Shares of this Zacks Rank #3
(Hold) company have generated a solid return of approximately
47.1% in the last year.
Drivers that Triggered Momentum
News Corporation is poised to benefit from increased
Television revenues due to sustained growth in retransmission
consent revenues and is expected to generate strong affiliate fee
growth through increased rates and an enlarged subscriber
Management anticipates channels businesses to deliver healthy
earnings growth on the back of sustained increase at Cable
Networks and growth at international channels, as well as
increase in advertising and affiliate revenues buoyed by FOX
News, Regional Sports Networks and FX Network.
The company is also focusing on enhancing its portfolio of
regional sports channels to strengthen the company's Fox Sports
Media Group's position in the lucrative sports entertainment
business, where it competes with
Walt Disney Company
) sports coverage network, ESPN.
Moreover, News Corporation remains on track to split into two
separate publicly traded publishing and media and entertainment
entities. The split is expected to augur well for News
Corporation, which has been in troubled waters since the
revelation of the phone hacking scandal.
Stock's Key Indicators
From the valuation perspective, News Corp. currently trades at
a forward P/E of 16.22x, a discount to the peer group average of
16.90x. Moreover, the company's return-on-equity (ROE), return on
assets (ROA) and return-on-investments (ROI) of 13.6%, 6.2% and
8.6%, respectively, are higher than the peer group averages.
Other Stocks to Consider
Until any further upward revision in News Corp's rating, other
media companies worth considering include
Lions Gate Entertainment
), which hold a Zacks Rank #1 (Strong Buy) and a Zacks Rank #2
DISNEY WALT (DIS): Free Stock Analysis Report
IMAX CORP (IMAX): Free Stock Analysis Report
LIONS GATE ETMT (LGF): Free Stock Analysis
NEWS CORP INC-A (NWSA): Free Stock Analysis
To read this article on Zacks.com click here.