News Corp (NASDAQ: NWSA)

Sector: Communication Services Industry: Entertainment CIK: 0001564708
Market Cap 12.76 Bn
P/B 1.45
P/E 11.08
P/S 1.48
ROIC (Qtr) 4.50
Div Yield % 0.89
Rev 1y % (Qtr) 5.54
Total Debt (Qtr) 2.85 Bn
Debt/Equity (Qtr) 0.32

About

News Corporation, or News Corp, (NWSA, NWS) is a global media and information services company that operates in various sectors, including digital real estate services, subscription video services, news and information services, book publishing, and others. The company's primary business activities are divided into six segments: Digital Real Estate Services, Subscription Video Services, Dow Jones, Book Publishing, News Media, and Other. The Digital Real Estate Services segment consists of News Corp's 61.4% interest in REA Group, a publicly-traded...

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Price action

Investment thesis

Bull case

  • Healthy cash reserves of 2.05B provide 82.04x coverage of short-term debt 25M, demonstrating strong liquidity position and minimal refinancing risk.
  • Strong tangible asset base of 9.12B provides 3.20x coverage of total debt 2.85B, indicating robust asset backing and low credit risk.
  • Operating cash flow of 1.08B provides exceptional 358.67x coverage of interest expenses 3M, showing strong debt service capability.
  • Tangible assets of 9.12B provide exceptional 19.24x coverage of deferred revenue 474M, showing strong service capability backing.
  • Robust free cash flow of 647M exceeds capital expenditure of 429M by 1.51x, indicating strong organic growth funding capability.

Bear case

  • Operating cash flow of 1.08B barely covers its investment activities of (305M), with a coverage ratio of -3.53, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 1.08B provides thin coverage of dividend payments of (197M) with a -5.46 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Cash reserves of 2.05B provide limited coverage of acquisition spending of (155M), which is -13.23x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • High receivables of 1.89B relative to inventory of 306M (6.19 ratio) suggests aggressive credit terms or collection difficulties, potentially masking revenue quality issues.
  • High depreciation of 469M relative to operating cash flow of 1.08B, which is 0.44x suggests significant maintenance capital requirements affecting free cash flow.

Segments Breakdown of Revenue (2025)

Geographical Breakdown of Revenue (2025)

Peer comparison

Companies in the Entertainment
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 NFLX Netflix Inc 349.87 Bn 31.86 7.74 14.46 Bn
2 DIS Walt Disney Co 195.56 Bn 15.96 2.04 46.64 Bn
3 WBD Warner Bros. Discovery, Inc. 66.35 Bn 136.80 1.75 33.52 Bn
4 FWONA Liberty Media Corp 46.91 Bn -352.74 11.61 7.04 Bn
5 LYV Live Nation Entertainment, Inc. 32.65 Bn 101.32 1.33 9.39 Bn
6 FOXA Fox Corp 29.03 Bn 15.35 1.75 6.60 Bn
7 TKO TKO Group Holdings, Inc. 17.65 Bn -220.73 5.07 4.04 Bn
8 WMG Warner Music Group Corp. 15.37 Bn 768.35 4.64 4.61 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.86 1.60
EV to Cash from Ops. EV/CFO 12.47 74.22
EV to Debt EV to Debt 4.71 109.74
EV to EBIT EV/EBIT 9.37 24.34
EV to EBITDA EV/EBITDA 10.09 31.84
EV to Free Cash Flow [EV/FCF] EV/FCF 20.73 -338.96
EV to Market Cap EV to Market Cap 1.05 62.35
EV to Revenue EV/Rev 1.56 9.43
Price to Book Value [P/B] P/B 1.45 3.87
Price to Earnings [P/E] P/E 11.08 -61.07
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 5.84 1.25
Dividend Payout Ratio % Div Payout % (Qtr) 9.90 -16.52
Dividend per Basic Share Div per Share (Qtr) 0.20 0.14
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 17.36 7.95
Interest Coverage Int. cover (Qtr) 477.00 -7.86
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -19.17 -46.16
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 17.13 2,379.93
Dividend Growth (1y) % Div 1y % (Qtr) 0.00 0.45
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 178.60 -74.64
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 6.57 3.12
EBIT Growth (1y) % EBIT 1y % (Qtr) 112.31 -56.93
EBT Growth (1y) % EBT 1y % (Qtr) 111.87 11.72
EPS Growth (1y) % EPS 1y % (Qtr) 178.08 23.88
FCF Growth (1y) % FCF 1y % (Qtr) -19.33 -92.46
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 4.63 0.48
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.56 0.60
Cash Payout Ratio Cash Payout (Qtr) 0.13 0.04
Cash Ratio Cash Ratio (Qtr) 0.81 0.48
Current Ratio Curr Ratio (Qtr) 1.81 1.22
Debt to Equity Ratio Debt/Equity (Qtr) 0.32 1.03
Interest Cover Ratio Int Coverage (Qtr) 477.00 -7.86
Times Interest Earned Times Interest Earned (Qtr) 477.00 -7.86
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 22.00 -64.95
EBIT Margin % EBIT Margin % (Qtr) 16.59 -79.29
EBT Margin % EBT Margin % (Qtr) 16.56 -82.30
Gross Margin % Gross Margin % (Qtr) 56.30 35.55
Net Profit Margin % Net Margin % (Qtr) 13.30 -82.96