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Investing.com - Guggenheim raised its price target on FOX Corp. (NASDAQ:FOXA) to $68.00 from $62.00 on Friday, while maintaining a Buy rating on the stock. FOX shares are currently trading at $60.23, having delivered an impressive 25.15% return year-to-date. According to InvestingPro analysis, the stock is currently trading at Fair Value levels.
The price target increase reflects steady ratings strength and advertising momentum for live sports content, which continues to underpin Guggenheim’s positive outlook on FOX shares. The firm expects this momentum to continue in the fiscal second quarter given the strong start to the NFL season. This optimism is supported by FOX’s strong financial health, with InvestingPro data showing a perfect Piotroski Score of 9 and robust liquidity with a current ratio of 2.91.
Guggenheim raised its first-quarter total company EBITDA estimate to $823 million from $804 million previously, with the full-year forecast now at $3.15 billion. The firm’s revised free cash flow projection shows a larger headwind in the first half of the year driven by higher sports and entertainment programming costs.
The firm expects first-quarter free cash flow of negative $354 million compared to its previous estimate of negative $115 million, though it anticipates this decline will reverse in the second half of the fiscal year with additional momentum into fiscal 2027. Full-year free cash flow is now projected at $1.3 billion, up from $1.1 billion previously.
Guggenheim noted that tough ratings comparisons at FOX’s news division against last year’s political strength are likely to continue through the fiscal second quarter, though the firm believes overall cable ad demand remains firm. FOX has demonstrated strong revenue growth of 16.6% over the last twelve months. For deeper insights into FOX’s financial health and growth prospects, including 8 additional exclusive ProTips, check out the comprehensive Pro Research Report available on InvestingPro.
In other recent news, Fox Corporation reported impressive fourth-quarter fiscal 2025 results, with adjusted earnings per share of $1.27, surpassing analyst expectations of $0.99. The company’s revenue reached $3.29 billion, exceeding the consensus forecast of $3.12 billion, marking a 6% increase from the previous year. Advertising revenues grew by 7%, driven by digital growth from the Tubi AVOD service and stronger news ratings. Additionally, affiliate fee revenues saw a 3% rise, with the Television segment growing 4% and the Cable Network Programming segment increasing by 2%.
In another development, Fox Corporation announced a resolution to the Murdoch Family Trust legal proceedings, leading to a secondary offering of Class B common stock. The resolution resulted in Prudence MacLeod, Elisabeth Murdoch, and James Murdoch ceasing to be beneficiaries of any trust holding shares in Fox or News Corporation. Furthermore, Fox Corporation and ESPN revealed a new bundled streaming package, priced at $39.99 per month, set to launch on October 2. This partnership will provide sports fans with access to a wide range of content, including NFL, NBA, MLB, and more.
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