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On Tuesday, Bernstein SocGen Group maintained its Market Perform rating on FOX Corp. (NASDAQ:FOXA) with a steady price target of $53.00. The $24.35 billion media giant has reportedly surpassed expectations in key areas, delivering a 3.5% revenue increase, excluding Super Bowl contributions. This performance, supported by an impressive 15.7% year-over-year revenue growth, is particularly notable in light of the challenging conditions within the broader industry. According to InvestingPro analysis, FOX currently appears undervalued based on its Fair Value estimates.
FOX’s affiliate fee revenue has continued to rise, successfully compensating for a decline in subscriber numbers, which appears to be slowing down. The company has also managed to counteract the downward trend in linear advertising by harnessing significant advertising revenue growth from its streaming platform, Tubi. InvestingPro data reveals FOX maintains a strong financial position with a healthy current ratio of 2.45, indicating robust liquidity to support its growth initiatives.
The analyst praised FOX for its clear and effective strategy, which has been reflected in the company’s performance. "Another quarter of solid growth; Fox exceeded expectations across all key metrics," the analyst stated. The positive assessment also highlighted the company’s financial health and the ongoing activity of its share buyback program. This aligns with InvestingPro’s analysis, which awards FOX a "GREAT" financial health score, with additional insights available in the comprehensive Pro Research Report covering 1,400+ top stocks.
FOX Corp.’s ability to navigate industry headwinds while posting growth has been attributed to a combination of factors. The moderation in subscriber losses, coupled with the rise in affiliate fees, has provided a buffer against broader market challenges. Moreover, Tubi’s contribution to advertising revenue has become a significant asset for the company, helping to offset declines in traditional advertising streams.
The company’s financial strategies, including a healthy balance sheet and active buyback program, have also contributed to its stable performance. The analyst’s reiteration of the Market Perform rating and $53.00 price target reflects confidence in FOX’s current trajectory and its potential to maintain steady growth amidst industry shifts.
In other recent news, FOX Corp. reported impressive financial results for the third quarter of fiscal year 2025, surpassing market expectations. The company posted an adjusted earnings per share (EPS) of $1.10, exceeding the forecasted $0.89, and reported revenue of $4.37 billion, beating the anticipated $4.14 billion. This strong performance was driven by a 65% year-over-year increase in advertising revenue, largely due to the Super Bowl broadcast and the success of Tubi, FOX’s free ad-supported streaming service. Loop Capital Markets responded to FOX’s strong financial performance by raising its price target for the company’s stock to $64, maintaining a Buy rating. Additionally, CFRA analyst Kenneth Leon increased the stock price target to $59, also maintaining a Buy rating, and adjusted the fiscal year 2025 EPS forecast to $4.55. FOX Corp. has also seen notable growth in its Television segment, with a 40% revenue increase, and launched Fox One, a new streaming service. These developments reflect FOX Corp.’s strategic focus on news and sports content, with its flagship network, Fox News, achieving significant ratings increases.
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