Media stock Fox (FOXA) was already a pretty big wheel in the streaming arena thanks to its Tubi platform. Tubi is one of the biggest names around in the free ad-supported television (FAST) space, in the same class as Pluto. But Fox is looking to go premium this year, a move greeted with cheers by investors who sent shares up nearly 5% in Tuesday afternoon’s trading.
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This move comes in the wake of Fox’s aborted plan to be part of Venu, the massive sports-focused streaming conglomeration of several major media platforms at once. And sadly, current CEO Lachlan Murdoch did not offer up a lot of details about what the premium Fox streaming channel would be like.
However, early reports suggest it will bring in both Fox’s sports and news content. That would ostensibly include not only Fox News, but also Fox Business and Fox Sports, which could make it a fairly impressive package. Movies produced at 20th Century Fox may also get in on the action, and there is certainly a case to be made for all the little Fox shows that never got much action beyond their early days, like Drexell’s Class or The New Adventures of Beans Baxter.
A Sea Change, or a Drift Across?
Fox is not giving up on traditional cable, per se, and in fact reinforced plans to continue being found therein. Fox made it clear that the new streaming package was intended to be “…an offering to really target those cord-cutter and cord-nevers that are not traditionally in the cable bundle.” Fox is not interested in converting standard customers to direct-to-consumer customers, thus Fox expects “subscriber expectations will be modest and we are going to price the service accordingly.”
And, just to cement its broadcast plans, ahead of this weekend’s Super Bowl matchup, Fox will be offering up an interview from Florida between Bret Baier and President Trump. It will be part of the pregame festivities, reports note, so that promises to be one more reason to catch the Super Bowl.
Is FOXA a Good Stock to Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on FOXA stock based on seven Buys and nine Holds assigned in the past three months, as indicated by the graphic below. After a 75.23% rally in its share price over the past year, the average FOXA price target of $48.71 per share implies 10.01% downside risk.
