John Malone, the billionaire chairman of Liberty Media (LLYVK), still sees big potential in Formula One (FWONK), which his company bought eight years ago. In a recent Yahoo Finance podcast, he said shareholders are happy right now because F1 is doing very well. While Malone didn’t say the company is looking to sell, he didn’t rule it out either. If someone made an offer that was too good to pass up—one that pays more than what the board thinks F1 can deliver in the future—they would consider selling. He called F1 a strong business with great cash flow potential and opportunities to grow even more.
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Since Liberty Media bought the rights to the commercial side of Formula One for $301 million, the company has focused on making the sport more popular in the U.S. What used to be a mostly European sport now has American races in cities like Miami and Las Vegas. Liberty also helped fans stream races through F1 TV and other direct-to-consumer platforms. Furthermore, in 2019, the Netflix (NFLX) series Drive to Survive gave the sport a major boost in popularity, especially in North America. By 2024, viewership had jumped from 490 million in 2018 to 1.6 billion, and a record 6.5 million fans went to races that year.
That growing popularity has helped push up the value of F1 teams, which averaged $2.31 billion in 2023. Valuations could rise even more thanks to Apple’s (AAPL) Formula One movie, F1, starring Brad Pitt, and reports that Apple may also try to get F1’s TV rights. As a result, JPMorgan analyst David Karnovsky recently raised his price target for Liberty Media to $120 from $108, saying a big TV deal—possibly worth over $150 million—could be on the horizon.
Is FWONK a Good Stock to Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on FWONK stock based on 10 Buys, two Holds, and two Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average FWONK price target of $113.50 per share implies 13.5% upside potential.
