New York-based News Corporation (NWSA) is a global media and information services company with a diverse portfolio spanning news, digital real estate, book publishing, and subscription video services. Valued at a market cap of $15.6 billion, the company owns major brands such as The Wall Street Journal, Dow Jones, HarperCollins, and Realtor.com.
Companies valued at $10 billion or more are generally classified as “large-cap” stocks, and News Corporation fits this criterion perfectly. News Corporation leverages a strong portfolio of globally recognized brands, giving it a competitive edge in news, publishing, and digital real estate. Its diverse revenue streams across media, digital subscriptions, and real estate services reduce reliance on any single segment. A focus on digital transformation has enhanced profitability, with a growing base of paid subscribers.
Yet, despite its strong fundamentals, NWSA shares have retreated 10.5% from their 52-week high of $30.69, met on Feb. 19. The stock has declined 2.4% over the past three months, lagging behind the Communication Services Select Sector SPDR ETF Fund (XLC), which rose marginally during the same period.
While the stock has inched up 4.1% in the past six months, it continues to trail XLC’s 10.8% surge. Over the past year, News Corporation’s 5.4% gain pales in comparison to XLC’s impressive 21.8% return.
Additionally, NWSA has dipped below its 50-day and 200-day moving averages since the start of this month, indicating a downtrend.
On Feb. 5, NWSA shares rose marginally after reporting its Q2 results. Its adjusted EPS of $0.33 surpassed Wall Street expectations of $0.31. The company’s revenue was $2.24 billion, topping Wall Street forecasts of $2.17 billion, driven by growth in its Digital Real Estate Services, Book Publishing, and Dow Jones segments. Net income from continuing operations surged 58% to $306 million.
In comparison, rival Paramount Global (PARA) has surpassed NWSA, gaining 11.3% over the past six months.
Despite NWSA's underperformance over the past year, analysts are highly bullish about the stock's prospects. The stock has a consensus rating of “Strong Buy” from the nine analysts covering it, and the mean price target of $38.14 implies an upswing potential of 38.8% from the current market prices.
