Shares in broadcaster Fox Corporation (FOXA) treaded water in pre-market trading as a leading analyst questioned its valuation.
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Super Bowl Excites but Caution is the Word
Barclays Kannan Venkateshwar raised Fox Corporation’s price target to $50 from $39 after its Q2 results beat earnings and revenue expectations. But he kept an Equal Weight rating on the shares. He said Fox Corporation had shown “excellent execution” and that an “exceptional event calendar,” including this weekend’s Super Bowl in New Orleans, should continue to support growth. However, he cautioned that FOXA’s valuation of around $23 billion was “starting to look too rich.”
Doug Creutz of TD Cowen said he was “cautiously optimistic” as he increased its price target on FOXA from $42 to $45 but kept a Hold rating. This caution seems to have been reflected in the FOXA share price. It closed 5.18% higher on Tuesday after the earnings were released but was flat in pre-market trading.
MLB Ratings are a Home Run for FOXA
Five-star TipRanks rated analyst Michael Ng of Goldman Sachs however was more enthusiastic. He raised his price target on Fox Corporation stock to $60 from $57 and kept a Buy rating on its shares. Ng was impressed by the company topping Q2 EBITDA estimates on Television and Cable Network programming. This was driven by strong Fox News channel and sports ratings, especially the Major League Baseball Playoffs and the National Football League where iconic quarterback Tom Brady is now an analyst.
Ng also liked Fox Corporation’s record political advertising revenue driven by the Presidential election last November, the 31% growth recorded at its free streaming service Tubi and affiliate fees.
Is FOXA a Good Stock to Buy?
On TipRanks, FOXA has a Moderate Buy consensus based on 5 Buy and 6 Hold ratings. Its highest price target is $60. FOXA stock’s consenus price target is $52.90 implying an 3.18% downside.
