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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
News Corporation (XNAS:NWS) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
NWS
Name:
NEWS CORPORATION (XNAS:NWS)
Sector:
- 35000.00K
Industry:
Broadcasting
CEO:
Mr. Robert J. Thomson
Total Employees:
25,500
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -217.71% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF NEWS CORPORATION(NWS) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND BROADCASTING INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
17.3
One Month Price Target:
$17.43
Six Month Price Target :
$18.05
Likely Price in One Year's Time:
Ticker:
$18.81
Likely Trading Range Today Under (Normal Volatility)
$17.24
Price Upper limit ($) :
$17.39
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$16.42
This week:
$15.34
This month :
$13.38
Other Primary facts
Market Cap:
9.93B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
581.42M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
13.29%
-14.55%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$21.36
$19.49
$13.24
$15.11
Medium risk (<10%) entry points
Buy Call
Sell Call
$18.88
Buy Put:
Sell Put:
$18.48
$15.72
$16.12
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
NWS
Sharpe Ratio:
2.33%
Comparison:
NWS, is amongst the top 40% stocks with highest risk-adjusted returns
Sharpe ratio is 82.31% higher than the industry
& ratio is 2.27% higher than the market/S&P 500 average
Average Returns/Yield of
NWS
Daily returns:
0.07%
Weekly returns:
0.34%
Monthly returns:
1.34%
Yearly returns:
11.39%
Comparison of returns:
Average annual returns/yield (last 3 years) is 41.25% above industry average
Classification:
NWS, is amongst the top 40% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.58
Statistical test of Returns:
NWS has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.50%
Weekly Volatility:
5.58%
Monthly Volatility:
11.17%
Yearly Volatility:
38.69%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.80%
Volatility in last five trading days has been -68.16% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-5.06%
Weekly VaR:
-11.32%
Monthly VaR:
-22.64%
How Much Can the price of
NWS
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-19%
Worst case (decline):
-78.41%
This translates to price declining to:
$13.97
This translates to price declining to:
$3.73
Severe Crash Probability
Risk of crash in next 6/12 months: High (50-70%)
What is Value at Risk (VaR)?
Risk Fundamentals
NWS is a 59.76% riskier investment compared to the market/S&P 500 & is 36.87% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -17.27% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
NWS
Beta in relation to market/S&P 500--1.30
Expected beta in 1 year's time:
0.795
Expected beta in 3 year's time:
1.124
Unlevered (debt free) Beta:
0.984
Beta in relation to Nasdaq (XNAS):
0.558
Beta in relation to all global stocks::
0.686
Beta Comparison & Analysis
Beta of competitors/peers::
1.267
Beta is 2.25% higher than peers
Average Industry Beta:
1.203
Beta is 7.64% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
4.22%
Sustainable growth rate is -73.14% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.041
Alpha is 139013.83% above industry average alpha yield
Alpha is 259% higher than market/& is unsustainably high
Analysis of Cost of Capital of
NWS
Equity cost of capital:
0.120
Equity cost of capital is 5.53% above industry mean WACC
Unlevered (without debt) cost of capital:
9.14%
Before-tax cost of debt:
2.55%
After-tax cost of debt:
2.02%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
2.02%
WACC is 33.81% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$17.55
Revenue growth rate per share of (3Y):
1.1
Annual revenue growth rate is -92.43% below industry average
EPS:
$0.84
Expected Annual growth rate of EPS (3Y):
45.40%
Expected future EPS growth rate is 81.22% higher than the Broadcasting industry
Free cash flow (FCF) per share:
$1.26
Balance sheet equity growth per share: 1.94%
Equity growth rate per share is -97.27% lower than the industry
Debt per share
$5.23
EBITDA per share
$2.37
Valuation Analysis Today of
NWS
P/E Ratio:
20.88
P/E Ratio of Competitors/Peers:
71.74
P/E ratio is -70.90% lower than main peers & is 55.48% higher than the industry
Stock price/value with industry average P/E ratio: $11.28
NWS is 53.40% overvalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $131.79
Present value of the expected future dividends only: $19.05
P/S (Price to Sales ratio):
0.99
Price to sales ratio is -58.24% below the industry mean
P/B (Price to book value ratio):
1.1
Price to free cash flow: 13.71
Price to free cash flow ratio is 18.28% higher than the industry
Net income growth rate (3Y):
-121.54%
Net income growth rate is -1669.25% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 5.41%
Dividend yeild: 2.02%
Previous Dividend: $0.10
Previous adjusted dividend: $0.10
Previous Dividend: $0.35
Expected next dividend best case: $0.13
Expected next dividend worst case: $0.07
Average dividend payment (long-term): $0.09
Average dividend increase/decrease (growth rate) % per period: 10.00%
Expected next dividend payment date: 07/12/2022
Expected next dividend record date: 14/06/2022
Expected next dividend declaration date: 05/04/2022
Previous dividend payment date: 13/04/2022
Previous dividend record date: 16/03/2022
Previous dividend declaration date: 02/03/2022
Dividend History:
2022-03-15--$0.10
2021-08-19--$0.05
2020-09-15--$0.10
2021-09-14--$0.10
2021-03-16--$0.10
2020-03-10--$0.10
Dividend growth rate is -14.56% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
37.06%
Net debt to equity ratio:
16.91%
Debt to assets ratio:
18.53%
Net debt to assets ratio:
8.45%
Debt-to-asset ratio is -72.99% below industry average
Ability to repay debt:
Interest coverage ratio:
15.46
Interest coverage ratio is 255.02% more than industry average
Looking forward:
Debt growth rate:
183.72%
Annual debt growth is 990% higher than industry average debt growth rate
Debt repayment rate in last quarter: 11.18%
Analysis of Key Statistics
Correlation of price movement with the market:
0.486
Statistical significance of correlation:
NWS has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.52
Stock price is -6.43% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.52
Correlation of price movement with Nasdaq (^IXIC):
-0.017
Covariance of price movement with the market:
-0.025
Kurtosis
5.607
Returns have moderate fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.163
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
NWS
Gross Profit Margin Ratio:
-
Operating Profit Margin Ratio:
8.65%
Operating profit margin is 53.64% higher than the industry
Net Profit Margin Ratio:
-
Effective Tax Rate:
14.76%
Effective tax rate is -87.60% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
6.08%
Return on equity (ROE) is 100.55% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
3.04%
Return on assets (ROA) is -6.94% lower than the industry
Financial Leverage:
1.2x
Current Ratio:
1.34
Current ratio is -19.65% below industry average
Cash Conversion Cycle (days):
0
-
The remaining useful life of property plant & equipment is: 2.2 years
Stock based compensation to net income ratio:
-
In-depth Efficiency Analysis
Revenue generated per employee:
400.1K
Each employee generates -56% less revenue than industry average revenue per employee
EBITDA generated per employee:
54.0K
Each employee generates -79% less EBITDA than industry average revenue per employee
Profit generated per employee:
19.6K
Each employee generates -78% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
- 1.4K
Each employee generates -107% less free cash flow than industry average revenue per employee
Assets/Capital per employee
472.4K
Each employee generates -107% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
NWS
NEWS CORPORATION (XNAS:NWSA)
IAC INC. (XNAS:IAC)
ZILLOW GROUP, INC. (XNAS:ZG)
Bilibili Inc. (XNAS:BILI)
DISCOVERY, INC. (XNAS:DISCK)
WARNER BROS. DISCOVERY, INC. (XNAS:WBD)
DISCOVERY, INC. (XNAS:DISCB)
LIBERTY GLOBAL PLC (XNAS:LBTYK)
LIBERTY GLOBAL PLC (XNAS:LBTYA)
Current Analyst Ratings
Strong buy�0%
Buy�0%
Hold�0%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: -
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
10.20B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
-
-
-
-
3.59B
-
5.73B
9.32B
-
89.00M
681.00M
1.38B
883.00M
499.00M
725.00M
107.00M
499.00M
Statement of Cash Flow
Date:
Period:
165.00M
Differed Income Tax :
27.00M
Stock Based Compensation :
-
Change in Working Capital :
- 290000.00K
Accounts Receivables:
9.00M
Other Working Capital:
-
Other Non-Cash Items:
- 30000.00K
Net Cash Provided by Operating Activities:
68.00M
Investments in PP&E:
- 2000.00K
Net Acquisitions:
- 16000.00K
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
9/30/21
2022
Q1
2.10B
-
2.10B
1.50B
308.00M
465.00M
4.37B
3.17B
4.57B
2.11B
499.00M
345.00M
1.36B
12.05B
-
16.42B
309.00M
445.00M
34.00M
467.00M
2.05B
3.27B
3.04B
706.00M
4.00B
-
7.27B
6.00M
- 2715000.00K
- 1061000.0K
11.98B
September 30, 2021 at 6:00:00 AM
9.32B
8.21B
15.48B
-
3.49B
1.4B
-
- 77000.00K
- 95000.00K
- 383000.00K
-
-
- 27000.00K
325.00M
- 85000.00K
- 24000.00K
- 136000.00K
2.10B
2.24B
68.00M
- 103000.00K
- 35000.00K
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
NWS
2023
2024
2025
2026
2027
$18.90
$43.52
$47.31
$51.42
$55.90