NEWS CORP - CLASS B (NWS) Stock Fundamental Analysis
NASDAQ:NWS - Nasdaq - US65249B2088 - Common Stock - Currency: USD
NWS gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 97 industry peers in the Media industry. While NWS belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. NWS is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year NWS was profitable.
NWS had a positive operating cash flow in the past year.
Of the past 5 years NWS 4 years were profitable.
NWS had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 2.56%, NWS is in the better half of the industry, outperforming 73.20% of the companies in the same industry.
Looking at the Return On Equity, with a value of 5.08%, NWS is in the better half of the industry, outperforming 70.10% of the companies in the same industry.
NWS has a better Return On Invested Capital (4.36%) than 60.82% of its industry peers.
NWS had an Average Return On Invested Capital over the past 3 years of 3.62%. This is below the industry average of 7.03%.
The 3 year average ROIC (3.62%) for NWS is below the current ROIC(4.36%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.56% | ||
| ROE | 5.08% | ||
| ROIC | 4.36% |
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 4.22%, NWS is doing good in the industry, outperforming 73.20% of the companies in the same industry.
NWS's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 9.10%, NWS is in the better half of the industry, outperforming 62.89% of the companies in the same industry.
In the last couple of years the Operating Margin of NWS has grown nicely.
The Gross Margin of NWS (51.86%) is better than 64.95% of its industry peers.
In the last couple of years the Gross Margin of NWS has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 9.1% | ||
| PM (TTM) | 4.22% | ||
| GM | 51.86% |
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.
NWS has less shares outstanding than it did 1 year ago.
NWS has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, NWS has an improved debt to assets ratio.
2.2 Solvency
NWS has an Altman-Z score of 2.13. This is not the best score and indicates that NWS is in the grey zone with still only limited risk for bankruptcy at the moment.
NWS has a Altman-Z score of 2.13. This is in the better half of the industry: NWS outperforms 75.26% of its industry peers.
NWS has a debt to FCF ratio of 2.64. This is a good value and a sign of high solvency as NWS would need 2.64 years to pay back of all of its debts.
The Debt to FCF ratio of NWS (2.64) is better than 84.54% of its industry peers.
A Debt/Equity ratio of 0.24 indicates that NWS is not too dependend on debt financing.
The Debt to Equity ratio of NWS (0.24) is better than 69.07% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.24 | ||
| Debt/FCF | 2.64 | ||
| Altman-Z | 2.13 |
ROIC/WACC0.54
WACC8.14%
2.3 Liquidity
NWS has a Current Ratio of 1.73. This is a normal value and indicates that NWS is financially healthy and should not expect problems in meeting its short term obligations.
With a Current ratio value of 1.73, NWS perfoms like the industry average, outperforming 59.79% of the companies in the same industry.
NWS has a Quick Ratio of 1.65. This is a normal value and indicates that NWS is financially healthy and should not expect problems in meeting its short term obligations.
NWS's Quick ratio of 1.65 is in line compared to the rest of the industry. NWS outperforms 58.76% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.73 | ||
| Quick Ratio | 1.65 |
3. Growth
3.1 Past
NWS shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 26.15%, which is quite impressive.
NWS shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 8.76% yearly.
NWS shows a decrease in Revenue. In the last year, the revenue decreased by -1.51%.
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)26.15%
EPS 3Y1.47%
EPS 5Y8.76%
EPS Q2Q%26.92%
Revenue 1Y (TTM)-1.51%
Revenue growth 3Y2.53%
Revenue growth 5Y0.02%
Sales Q2Q%-13.96%
3.2 Future
The Earnings Per Share is expected to grow by 13.10% on average over the next years. This is quite good.
Based on estimates for the next years, NWS will show a decrease in Revenue. The Revenue will decrease by -0.49% on average per year.
EPS Next Y30.85%
EPS Next 2Y24.38%
EPS Next 3Y20.34%
EPS Next 5Y13.1%
Revenue Next Year-13.28%
Revenue Next 2Y-6.59%
Revenue Next 3Y-3.33%
Revenue Next 5Y-0.49%
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
With a Price/Earnings ratio of 35.91, NWS can be considered very expensive at the moment.
NWS's Price/Earnings ratio is in line with the industry average.
NWS's Price/Earnings ratio indicates a valuation a bit more expensive than the S&P500 average which is at 27.63.
Based on the Price/Forward Earnings ratio of 27.20, the valuation of NWS can be described as expensive.
NWS's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. NWS is cheaper than 61.86% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of NWS to the average of the S&P500 Index (20.85), we can say NWS is valued slightly more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 35.91 | ||
| Fwd PE | 27.2 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as NWS.
NWS's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.46 | ||
| EV/EBITDA | 11.48 |
4.3 Compensation for Growth
NWS's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of NWS may justify a higher PE ratio.
A more expensive valuation may be justified as NWS's earnings are expected to grow with 20.34% in the coming years.
PEG (NY)1.16
PEG (5Y)4.1
EPS Next 2Y24.38%
EPS Next 3Y20.34%
5. Dividend
5.1 Amount
With a yearly dividend of 0.77%, NWS is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 5.05, NWS pays a bit more dividend than its industry peers.
With a Dividend Yield of 0.77, NWS pays less dividend than the S&P500 average, which is at 2.51.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.77% |
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.
As NWS did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)1.81%
Div Incr Years0
Div Non Decr Years9
5.3 Sustainability
43.24% of the earnings are spent on dividend by NWS. This is a bit on the high side, but may be sustainable.
The dividend of NWS is growing, but earnings are growing more, so the dividend growth is sustainable.
DP43.24%
EPS Next 2Y24.38%
EPS Next 3Y20.34%
29.45
-0.55 (-1.83%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryMedia
Earnings (Last)
Earnings (Next)
Inst Owners102.44%
Inst Owner Change0.48%
Ins Owners0.03%
Ins Owner Change0%
Market Cap16.71B
Analysts82.5
Price Target41.36 (40.44%)
Short Float %1.54%
Short Ratio7.59
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.77% |
Yearly Dividend0.3
Dividend Growth(5Y)1.81%
DP43.24%
Div Incr Years0
Div Non Decr Years9
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)15.23%
Min EPS beat(2)3.18%
Max EPS beat(2)27.28%
EPS beat(4)4
Avg EPS beat(4)10.38%
Min EPS beat(4)3.18%
Max EPS beat(4)27.28%
EPS beat(8)8
Avg EPS beat(8)34.78%
EPS beat(12)10
Avg EPS beat(12)58.01%
EPS beat(16)14
Avg EPS beat(16)71.9%
Revenue beat(2)1
Avg Revenue beat(2)-1.27%
Min Revenue beat(2)-2.91%
Max Revenue beat(2)0.36%
Revenue beat(4)2
Avg Revenue beat(4)-1.03%
Min Revenue beat(4)-3.16%
Max Revenue beat(4)1.58%
Revenue beat(8)3
Avg Revenue beat(8)-1.05%
Revenue beat(12)4
Avg Revenue beat(12)-1.22%
Revenue beat(16)8
Avg Revenue beat(16)0.24%
PT rev (1m)-0.18%
PT rev (3m)1.41%
EPS NQ rev (1m)-10.26%
EPS NQ rev (3m)-4.76%
EPS NY rev (1m)-5.27%
EPS NY rev (3m)2.75%
Revenue NQ rev (1m)-0.2%
Revenue NQ rev (3m)-20.56%
Revenue NY rev (1m)-0.61%
Revenue NY rev (3m)-16.77%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 35.91 | ||
| Fwd PE | 27.2 | ||
| P/S | 1.7 | ||
| P/FCF | 22.46 | ||
| P/OCF | 14.39 | ||
| P/B | 2.05 | ||
| P/tB | 8.39 | ||
| EV/EBITDA | 11.48 |
EPS(TTM)0.82
EY2.78%
EPS(NY)1.08
Fwd EY3.68%
FCF(TTM)1.31
FCFY4.45%
OCF(TTM)2.05
OCFY6.95%
SpS17.3
BVpS14.36
TBVpS3.51
PEG (NY)1.16
PEG (5Y)4.1
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.56% | ||
| ROE | 5.08% | ||
| ROCE | 7.18% | ||
| ROIC | 4.36% | ||
| ROICexc | 5.08% | ||
| ROICexgc | 12% | ||
| OM | 9.1% | ||
| PM (TTM) | 4.22% | ||
| GM | 51.86% | ||
| FCFM | 7.58% |
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-Score9
Asset Turnover0.61
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.24 | ||
| Debt/FCF | 2.64 | ||
| Debt/EBITDA | 1.3 | ||
| Cap/Depr | 68.47% | ||
| Cap/Sales | 4.25% | ||
| Interest Coverage | 5.88 | ||
| Cash Conversion | 77.3% | ||
| Profit Quality | 179.71% | ||
| Current Ratio | 1.73 | ||
| Quick Ratio | 1.65 | ||
| Altman-Z | 2.13 |
F-Score9
WACC8.14%
ROIC/WACC0.54
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)26.15%
EPS 3Y1.47%
EPS 5Y8.76%
EPS Q2Q%26.92%
EPS Next Y30.85%
EPS Next 2Y24.38%
EPS Next 3Y20.34%
EPS Next 5Y13.1%
Revenue 1Y (TTM)-1.51%
Revenue growth 3Y2.53%
Revenue growth 5Y0.02%
Sales Q2Q%-13.96%
Revenue Next Year-13.28%
Revenue Next 2Y-6.59%
Revenue Next 3Y-3.33%
Revenue Next 5Y-0.49%
EBIT growth 1Y12.33%
EBIT growth 3Y7.85%
EBIT growth 5Y5.33%
EBIT Next Year79.48%
EBIT Next 3Y27.15%
EBIT Next 5Y19.52%
FCF growth 1Y28.5%
FCF growth 3Y-10.76%
FCF growth 5Y11.08%
OCF growth 1Y7%
OCF growth 3Y-3.9%
OCF growth 5Y3.42%