Is Market Overlooking FOXA Right Now?

Here is why we think Fox (FOXA) deserves consideration as a value stock.

• Reasonable Revenue Growth: 15.7% LTM and 5.6% last 3 year average.
• Cash Generative: Nearly 14.8% free cash flow margin and 19.0% operating margin LTM.
• No Major Shocks: FOXA has avoided any large revenue collapses in the last 3 years.
• Modest Valuation: Despite encouraging fundamentals, FOXA trades at a PE multiple of 13.5
• Opportunity vs S&P: Compared to S&P, you get lower valuation, higher LTM revenue growth, and better margins

As a quick background, Fox operates U.S. news, sports, and entertainment channels including national cable networks for news, business, multi-sport, and soccer programming across three main segments.

*LTM: Last Twelve Months

But do these numbers tell the full story? Read Buy or Sell FOXA Stock to see if Fox still has an edge that holds up under the hood.

That is one way to look at stocks. Trefis High Quality Portfolio evaluates much more, and is designed to reduce stock-specific risk while giving upside exposure

Stocks Like These Can Outperform. Here Is Data

For 65 similar value stocks chosen as of mid 2024, consider the following stats for the subsequent 1 year period.

• Average peak return of 39.3% vs 14.4% for S&P, with maximum peak return of 133%
• Win rate of 60%; win rate represents % of stocks with positive return
• Average 1-year return of 14.6%, similar to S&P’s despite tariff instability

But Consider The Risk

That said, FOXA isn’t immune to big drops. It fell 79% during the Global Financial Crisis and 63% in the Dot-Com Bubble. The 2018 correction and Covid sell-off still hit hard, with declines around 41% and 48%. Even the recent inflation shock shaved off about 35%. Strong fundamentals matter, but FOXA shows how volatile stocks can be when markets turn south.

But the risk is not limited to major market crashes. Stocks fall even when markets are good – think events like earnings, business updates, outlook changes. Read FOXA Dip Buyer Analyses to see how the stock has recovered from sharp dips in the past.

The Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 – the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.