NEWS CORP - CLASS B (NWS) Stock Fundamental Analysis
NASDAQ:NWS - Nasdaq - US65249B2088 - Common Stock - Currency: USD
Overall NWS gets a fundamental rating of 6 out of 10. We evaluated NWS against 97 industry peers in the Media industry. NWS scores excellent points on both the profitability and health parts. This is a solid base for a good stock. NWS has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
NWS had positive earnings in the past year.
NWS had a positive operating cash flow in the past year.
Of the past 5 years NWS 4 years were profitable.
Each year in the past 5 years NWS had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 2.94%, NWS is in the better half of the industry, outperforming 74.23% of the companies in the same industry.
The Return On Equity of NWS (5.94%) is better than 68.04% of its industry peers.
Looking at the Return On Invested Capital, with a value of 4.61%, NWS is in the better half of the industry, outperforming 62.89% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for NWS is below the industry average of 7.56%.
The last Return On Invested Capital (4.61%) for NWS is above the 3 year average (3.62%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.94% | ||
| ROE | 5.94% | ||
| ROIC | 4.61% |
ROA(3y)2.03%
ROA(5y)-0.17%
ROE(3y)4.23%
ROE(5y)0%
ROIC(3y)3.62%
ROIC(5y)3.12%
1.3 Margins
With a decent Profit Margin value of 5.18%, NWS is doing good in the industry, outperforming 75.26% of the companies in the same industry.
In the last couple of years the Profit Margin of NWS has grown nicely.
Looking at the Operating Margin, with a value of 10.08%, NWS is in the better half of the industry, outperforming 64.95% of the companies in the same industry.
In the last couple of years the Operating Margin of NWS has grown nicely.
With a decent Gross Margin value of 53.29%, NWS is doing good in the industry, outperforming 64.95% of the companies in the same industry.
In the last couple of years the Gross Margin of NWS has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.08% | ||
| PM (TTM) | 5.18% | ||
| GM | 53.29% |
OM growth 3Y5.19%
OM growth 5Y5.3%
PM growth 3Y-9.23%
PM growth 5Y11.38%
GM growth 3Y1%
GM growth 5Y2.67%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so NWS is destroying value.
Compared to 1 year ago, NWS has less shares outstanding
The number of shares outstanding for NWS has been reduced compared to 5 years ago.
The debt/assets ratio for NWS has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 2.23 indicates that NWS is not a great score, but indicates only limited risk for bankruptcy at the moment.
With a decent Altman-Z score value of 2.23, NWS is doing good in the industry, outperforming 70.10% of the companies in the same industry.
NWS has a debt to FCF ratio of 2.43. This is a good value and a sign of high solvency as NWS would need 2.43 years to pay back of all of its debts.
NWS has a Debt to FCF ratio of 2.43. This is amongst the best in the industry. NWS outperforms 85.57% of its industry peers.
NWS has a Debt/Equity ratio of 0.24. This is a healthy value indicating a solid balance between debt and equity.
NWS has a better Debt to Equity ratio (0.24) than 68.04% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.24 | ||
| Debt/FCF | 2.43 | ||
| Altman-Z | 2.23 |
ROIC/WACC0.56
WACC8.25%
2.3 Liquidity
NWS has a Current Ratio of 1.68. This is a normal value and indicates that NWS is financially healthy and should not expect problems in meeting its short term obligations.
NWS has a Current ratio of 1.68. This is in the better half of the industry: NWS outperforms 63.92% of its industry peers.
A Quick Ratio of 1.60 indicates that NWS should not have too much problems paying its short term obligations.
With a decent Quick ratio value of 1.60, NWS is doing good in the industry, outperforming 63.92% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.68 | ||
| Quick Ratio | 1.6 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 31.34% over the past year.
The Earnings Per Share has been growing by 8.76% on average over the past years. This is quite good.
The Revenue has decreased by -5.43% in the past year.
Measured over the past years, NWS shows a small growth in Revenue. The Revenue has been growing by 0.02% on average per year.
EPS 1Y (TTM)31.34%
EPS 3Y1.47%
EPS 5Y8.76%
EPS Q2Q%54.55%
Revenue 1Y (TTM)-5.43%
Revenue growth 3Y2.53%
Revenue growth 5Y0.02%
Sales Q2Q%-17.09%
3.2 Future
Based on estimates for the next years, NWS will show a quite strong growth in Earnings Per Share. The EPS will grow by 13.89% on average per year.
NWS is expected to show a decrease in Revenue. In the coming years, the Revenue will decrease by -0.43% yearly.
EPS Next Y30.05%
EPS Next 2Y22.81%
EPS Next 3Y19.8%
EPS Next 5Y13.89%
Revenue Next Year-14.25%
Revenue Next 2Y-6.52%
Revenue Next 3Y-3.26%
Revenue Next 5Y-0.43%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 38.97, which means the current valuation is very expensive for NWS.
Compared to the rest of the industry, the Price/Earnings ratio of NWS indicates a somewhat cheap valuation: NWS is cheaper than 60.82% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.30, NWS is valued a bit more expensive.
The Price/Forward Earnings ratio is 32.48, which means the current valuation is very expensive for NWS.
The rest of the industry has a similar Price/Forward Earnings ratio as NWS.
When comparing the Price/Forward Earnings ratio of NWS to the average of the S&P500 Index (21.76), we can say NWS is valued slightly more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 38.97 | ||
| Fwd PE | 32.48 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of NWS is on the same level as its industry peers.
Based on the Price/Free Cash Flow ratio, NWS is valued a bit cheaper than 60.82% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 24.05 | ||
| EV/EBITDA | 13.1 |
4.3 Compensation for Growth
NWS's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
NWS has a very decent profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as NWS's earnings are expected to grow with 19.80% in the coming years.
PEG (NY)1.3
PEG (5Y)4.45
EPS Next 2Y22.81%
EPS Next 3Y19.8%
5. Dividend
5.1 Amount
NWS has a yearly dividend return of 0.67%, which is pretty low.
NWS's Dividend Yield is a higher than the industry average which is at 4.62.
Compared to an average S&P500 Dividend Yield of 2.37, NWS's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.67% |
5.2 History
The dividend of NWS has a limited annual growth rate of 1.81%.
NWS has been paying a dividend for at least 10 years, so it has a reliable track record.
NWS has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)1.81%
Div Incr Years0
Div Non Decr Years9
5.3 Sustainability
NWS pays out 37.99% of its income as dividend. This is a sustainable payout ratio.
NWS's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP37.99%
EPS Next 2Y22.81%
EPS Next 3Y19.8%
34.29
-0.16 (-0.46%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryMedia
Earnings (Last)
Earnings (Next)
Inst Owners103.78%
Inst Owner Change0%
Ins Owners0.03%
Ins Owner Change0%
Market Cap19.41B
Analysts81.25
Price Target42.39 (23.62%)
Short Float %1.63%
Short Ratio9.39
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.67% |
Yearly Dividend0.3
Dividend Growth(5Y)1.81%
DP37.99%
Div Incr Years0
Div Non Decr Years9
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)11.11%
Min EPS beat(2)3.18%
Max EPS beat(2)19.05%
EPS beat(4)4
Avg EPS beat(4)14.03%
Min EPS beat(4)3.18%
Max EPS beat(4)27.28%
EPS beat(8)8
Avg EPS beat(8)27.6%
EPS beat(12)10
Avg EPS beat(12)58.92%
EPS beat(16)14
Avg EPS beat(16)68.53%
Revenue beat(2)1
Avg Revenue beat(2)-0.58%
Min Revenue beat(2)-1.52%
Max Revenue beat(2)0.36%
Revenue beat(4)2
Avg Revenue beat(4)-0.62%
Min Revenue beat(4)-2.91%
Max Revenue beat(4)1.58%
Revenue beat(8)2
Avg Revenue beat(8)-1.39%
Revenue beat(12)4
Avg Revenue beat(12)-1.15%
Revenue beat(16)7
Avg Revenue beat(16)-0.11%
PT rev (1m)-0.87%
PT rev (3m)2.47%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-13.04%
EPS NY rev (1m)-0.61%
EPS NY rev (3m)-4.03%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.37%
Revenue NY rev (1m)-0.78%
Revenue NY rev (3m)-1.56%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 38.97 | ||
| Fwd PE | 32.48 | ||
| P/S | 2.06 | ||
| P/FCF | 24.05 | ||
| P/OCF | 16.18 | ||
| P/B | 2.37 | ||
| P/tB | 9.53 | ||
| EV/EBITDA | 13.1 |
EPS(TTM)0.88
EY2.57%
EPS(NY)1.06
Fwd EY3.08%
FCF(TTM)1.43
FCFY4.16%
OCF(TTM)2.12
OCFY6.18%
SpS16.61
BVpS14.49
TBVpS3.6
PEG (NY)1.3
PEG (5Y)4.45
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.94% | ||
| ROE | 5.94% | ||
| ROCE | 7.58% | ||
| ROIC | 4.61% | ||
| ROICexc | 5.54% | ||
| ROICexgc | 13.59% | ||
| OM | 10.08% | ||
| PM (TTM) | 5.18% | ||
| GM | 53.29% | ||
| FCFM | 8.58% |
ROA(3y)2.03%
ROA(5y)-0.17%
ROE(3y)4.23%
ROE(5y)0%
ROIC(3y)3.62%
ROIC(5y)3.12%
ROICexc(3y)4.19%
ROICexc(5y)3.63%
ROICexgc(3y)11.93%
ROICexgc(5y)9.92%
ROCE(3y)5.95%
ROCE(5y)5.14%
ROICexcg growth 3Y10.45%
ROICexcg growth 5Y-0.35%
ROICexc growth 3Y6.7%
ROICexc growth 5Y3.57%
OM growth 3Y5.19%
OM growth 5Y5.3%
PM growth 3Y-9.23%
PM growth 5Y11.38%
GM growth 3Y1%
GM growth 5Y2.67%
F-Score8
Asset Turnover0.57
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.24 | ||
| Debt/FCF | 2.43 | ||
| Debt/EBITDA | 1.31 | ||
| Cap/Depr | 74.01% | ||
| Cap/Sales | 4.18% | ||
| Interest Coverage | 6.32 | ||
| Cash Conversion | 81.14% | ||
| Profit Quality | 165.71% | ||
| Current Ratio | 1.68 | ||
| Quick Ratio | 1.6 | ||
| Altman-Z | 2.23 |
F-Score8
WACC8.25%
ROIC/WACC0.56
Cap/Depr(3y)70%
Cap/Depr(5y)67.07%
Cap/Sales(3y)4.92%
Cap/Sales(5y)4.76%
Profit Quality(3y)253.85%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)31.34%
EPS 3Y1.47%
EPS 5Y8.76%
EPS Q2Q%54.55%
EPS Next Y30.05%
EPS Next 2Y22.81%
EPS Next 3Y19.8%
EPS Next 5Y13.89%
Revenue 1Y (TTM)-5.43%
Revenue growth 3Y2.53%
Revenue growth 5Y0.02%
Sales Q2Q%-17.09%
Revenue Next Year-14.25%
Revenue Next 2Y-6.52%
Revenue Next 3Y-3.26%
Revenue Next 5Y-0.43%
EBIT growth 1Y24.08%
EBIT growth 3Y7.85%
EBIT growth 5Y5.33%
EBIT Next Year79.72%
EBIT Next 3Y27.5%
EBIT Next 5Y18.99%
FCF growth 1Y74.68%
FCF growth 3Y-10.76%
FCF growth 5Y11.08%
OCF growth 1Y20.72%
OCF growth 3Y-3.9%
OCF growth 5Y3.42%