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Fox (FOXA)
NASDAQ:FOXA
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Fox
(NASDAQ:FOXA)
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Rating:68Neutral
Price Target:
$63.00
▲(9.11% Upside)
Action:DowngradedDate:02/05/26
The score is driven primarily by solid financial fundamentals (profitability, ROE, manageable leverage, and strong absolute free cash flow) and a generally positive earnings-call outlook with streaming/engagement momentum and shareholder returns. This is tempered by weak near-term technicals (downtrend and negative MACD) and some profitability/margin pressure highlighted in the latest quarter.
Positive Factors
Strong free cash flow
Sustained, sizable free cash flow (~$2.5B TTM) that tracks net income closely gives Fox durable financial flexibility to fund rights, invest in streaming (Tubi/Fox One), return capital via buybacks/dividends, and absorb cyclical ad seasonality without depending on new financing.
High returns on capital
A ~17% TTM ROE indicates management converts invested capital into attractive returns over time. Combined with manageable leverage (debt ≈0.6x equity), this supports reinvestment in core content and streaming while maintaining shareholder returns and preserving long‑term capital efficiency.
Streaming audience & profitability
Tubi's accelerating engagement and consecutive quarters of EBITDA profitability show the streaming arm is scaling economically. Durable growth in viewer time and monetization supports diversified revenue away from linear advertising and underpins long‑term distribution leverage and digital ad inventory value.
Negative Factors
Declining adjusted EBITDA
An 11% EBITDA decline despite revenue gains signals margin compression from rising costs and investment. If sustained, weaker EBITDA limits free cash flow upside and constrains reinvestment or buybacks, meaning profitability must re‑scale with revenue for durable earnings improvement.
Rising sports & production costs
Escalating sports rights and production costs are a structural margin risk for a sports‑heavy media portfolio. Persistent rights inflation can erode returns on content investment, pressure cable and broadcast margins, and require higher ad or distribution pricing to preserve long‑term profitability.
Ongoing pay‑TV subscriber decline
Continued pay‑TV subscriber erosion is a secular industry trend that reduces affiliate fee growth and carriage leverage over time. Even with some stabilization, sustained cord‑cutting forces Fox to offset lost distribution revenue via higher ad pricing, streaming monetization, or cost control to protect long‑term margins.
Fox (FOXA) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$23.21B
Dividend Yield0.75%
Average Volume (3M)4.51M
Price to Earnings (P/E)34.5
Beta (1Y)0.57
Revenue Growth14.91%
EPS Growth9.30%
CountryUS
Employees10,200
SectorCommunication Services
Sector Strength97
IndustryEntertainment
Share Statistics
EPS (TTM)0.82
Shares Outstanding200,693,860
10 Day Avg. Volume4,047,904
30 Day Avg. Volume4,506,579
Financial Highlights & Ratios
PEG Ratio0.20
Price to Book (P/B)2.16
Price to Sales (P/S)1.58
P/FCF Ratio8.63
Enterprise Value/Market Cap1.37
Enterprise Value/Revenue1.92
Enterprise Value/Gross Profit5.82
Enterprise Value/Ebitda9.51
Forecast
1Y Price Target
$71.21Price Target Upside23.33% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering14
EPS Forecast (FY)4.66
Revenue Forecast (FY)$16.29B
Fox Business Overview & Revenue Model
Company DescriptionFox Corporation operates as a news, sports, and entertainment company in the United States (U.S.). The company operates through Cable Network Programming; Television; and Other, Corporate and Eliminations segments. The Cable Network Programming segment produces and licenses news, business news, and sports content for distribution through traditional and virtual multi-channel video programming distributors (MVPDs) and other digital platforms, primarily in the U.S. It operates FOX News, a national cable news channel; FOX Business, a business news national cable channel; FS1 and FS2 multi-sport national networks; FOX Sports Racing, a video programming service that comprises motor sports programming; FOX Soccer Plus, a video programming network for live soccer and rugby competitions; FOX Deportes, a Spanish-language sports programming service; and Big Ten Network, a national video programming service. The Television segment acquires, produces, markets, and distributes programming. It operates The FOX Network, a national television broadcast network that broadcasts sports programming and entertainment; Tubi, an advertising-supported video-on-demand service; Fox Alternative Entertainment, a full-service production studio that develops and produces unscripted and alternative programming; MyNetworkTV, a programming distribution service; and Blockchain Creative Labs, which is focuses on the creation, distribution and monetization of Web3 content. This segment owns and operates 29 broadcast television stations. The Other, Corporate and Eliminations segment owns the FOX Studios Lot that provides production and post-production services, including 15 sound stages, two broadcast studios, theaters and screening rooms, editing rooms, and other television and film production facilities in Los Angeles, California. The company was incorporated in 2018 and is based in New York, New York.
How the Company Makes MoneyFox makes money mainly by monetizing audiences and distribution rights across its television and cable networks. A significant portion of revenue comes from advertising and marketing services sold across FOX’s national broadcast network, its owned-and-operated local stations, and its cable channels—particularly around live sports and news programming that typically draws large real-time audiences. Another major revenue stream is affiliate and subscription fees: cable, satellite, and virtual pay-TV distributors pay carriage fees to carry Fox’s cable networks (e.g., FOX News and FOX Sports channels), and broadcast distribution arrangements also generate revenue tied to distributing FOX network programming. Fox’s owned local stations also generate revenue from local advertising and, where applicable, retransmission-related payments tied to distributor carriage of those stations. Additional revenues can include content and brand licensing and other ancillary commercial activities associated with its media properties; if more specific line-item detail is required beyond these broad categories, null.
Fox Earnings Call Summary
Earnings Call Date:Feb 04, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:May 12, 2026
Earnings Call Sentiment Positive
The call presented multiple material operational and strategic wins — broad-based advertising strength (especially in sports and news), notable streaming momentum with Tubi profitability and growing engagement, successful early uptake of Fox One, and strong shareholder returns. These positives were tempered by margin and profitability pressures: adjusted EBITDA and GAAP net income declined, the TV segment experienced a significant EBITDA drop, higher sports rights/production costs, and a seasonal free cash flow deficit. Overall, the momentum in revenue, audience engagement and strategic initiatives appears to outweigh the near-term earnings and cost headwinds.Q2-2026 Updates
Positive Updates
Total Revenue Growth
Total revenues of $5.18 billion, a 2% increase year-over-year, driven by strength in advertising, distribution, and streaming.
Distribution Revenue Expansion
Distribution revenue grew 4% in the quarter, helped by pricing gains on affiliate renewals and improved sequential subscriber decline trends (subscriber decline improved to ~6.3%, excluding Fox One).
Cable Segment Outperformance
Cable reported revenues of $2.28 billion and adjusted EBITDA of $687 million, both up 5% year-over-year; cable advertising revenues grew 7% driven by higher pricing in news and sports.
Tubi: Audience and Revenue Momentum
Tubi delivered its most-streamed quarter ever with total viewer time up 27% YoY, revenue up 19% in the quarter, and achieved EBITDA profitability for the second consecutive quarter.
Record Sports and News Advertising
Record-breaking ad revenue for MLB postseason, highest ad revenue for NFL Sunday packages and college football regular season; Fox News achieved its highest second-quarter advertising revenue ever and added ~200 new advertisers in the half.
Digital and Engagement Strength
Fox News Digital social media views increased ~170% YoY; Fox News and Fox Business ranked #1 in YouTube video views among peers; total minutes viewed across sports, news, entertainment, and Tubi rose 15% YoY in calendar 2025.
Fox One Early Traction
Fox One (launched five months ago) exceeded expectations: meaningful direct sign-ups and partnerships, no noticeable cannibalization of traditional subscribers, news comprises ~1/3 of minutes viewed and news viewers engage ~2x more days/week and ~3x more minutes/week vs non-news viewers.
Shareholder Returns and Balance Sheet Discipline
Repurchased an additional $1.8 billion this fiscal year (cumulative $8.4 billion since 2019 ≈ 35% of shares outstanding), announced a $0.28/share semiannual dividend, and reported $2.0 billion cash vs $6.6 billion debt.
Negative Updates
Decline in Adjusted EBITDA
Quarterly adjusted EBITDA was $692 million versus $781 million prior year, a decline of $89 million (≈ -11%), as revenue gains were offset by higher expenses including digital growth initiatives and elevated sports programming and production costs.
Net Income and GAAP EPS Pressure
Net income attributable to stockholders fell to $229 million (EPS $0.52) from $373 million (EPS $0.81) the prior year; adjusted net income was $360 million with adjusted EPS $0.82, reflecting weaker GAAP results.
Television Segment Weakness
Television segment revenues of $2.94 billion; advertising flat and television content & other revenues down 19% YoY (timing of deliveries), with segment EBITDA down to $143 million from $205 million (~-30%).
Increased Corporate Costs from Fox One
Corporate segment EBITDA negativity widened from $81 million to $138 million, predominantly due to Fox One operating costs (platform costs sit in corporate; affiliate fees flow to network segments).
Higher Sports Rights and Production Costs
Reported expense growth driven by higher sports programming and production rights costs, which partially offset revenue gains and pressured margins across segments.
Free Cash Flow Seasonality Resulted in Deficit
Recorded a free cash flow deficit of $71 million for the quarter, attributed to seasonality (concentration of sports rights payments and buildup of ad receivables), though management expects reversal in second half.
Subscriber Base Still Declining
While subscriber decline rates improved, the underlying pay-TV subscriber base still declined (~6.3% year-over-year excluding Fox One), reflecting ongoing industry cord-cutting trends.
Company Guidance
Management said it expects momentum to continue into the second half of FY2026, pointing to a robust political advertising cycle and a profitable FIFA World Cup, and reiterated targets and seasonality: total Q2 revenues were $5.18B with adjusted EBITDA of $692M and adjusted EPS of $0.82 (adjusted net income $360M); advertising was up 1%, distribution revenue up 4%, cable revenues $2.28B (+5%) with cable EBITDA $687M (+5%), television revenues $2.94B with TV EBITDA $143M, Tubi revenue +19% and total viewer time +27% YoY (Tubi achieved EBITDA profitability for the second consecutive quarter), total minutes viewed across brands +15% in CY2025, and scatter news pricing up ~46–47% YoY alongside ~200 new advertisers this half; management expects Fox One to reach low‑to‑mid single‑digit millions of subscribers over the next 3–4 years (subscriber declines improved to ~6.3% ex‑Fox One), free cash flow seasonality (Q2 FCF deficit $71M) to reverse in H2, remaining ASR settlement and continued buybacks (additional $1.8B FY‑to‑date, cumulative repurchases $8.4B or ~35% of shares), a $0.28/share semiannual dividend, and a strong balance sheet with ~$2B cash and $6.6B debt.Fox Financial Statement Overview
Summary
Profitability is solid with healthy TTM margins and strong ROE (~17%), leverage looks manageable (debt ~0.6x equity), and absolute free cash flow is strong (~$2.5B). Offsetting this, margins and cash conversion have been volatile, and the latest period shows revenue strength but weaker net income versus FY2025.Income Statement
FOXA shows solid profitability with TTM (Trailing-Twelve-Months) operating and net margins around the high-teens and low-teens, respectively, supported by strong recent top-line momentum (TTM revenue growth of ~63% versus mid-teens in FY2025). That said, profitability has not scaled with revenue in the latest period (net income down versus FY2025), and margins have been volatile over the cycle (notably higher in FY2021 and meaningfully lower in FY2022–FY2024). Overall, the earnings profile is healthy but not consistently improving year to year.78
Positive
Balance Sheet
Leverage looks manageable with debt at roughly 0.6x equity in both TTM (Trailing-Twelve-Months) and FY2025, an improvement from higher leverage levels seen in FY2023–FY2024. Returns on shareholder capital are strong (TTM return on equity ~17%), indicating efficient capital use. The main watch item is that debt remains sizable in absolute terms, and equity has moved around over time, so balance-sheet flexibility is good but not pristine.74
Positive
Cash Flow
Cash generation is a clear strength: TTM (Trailing-Twelve-Months) free cash flow is substantial (~$2.5B) and tracks net income reasonably well (free cash flow at ~88% of net income), suggesting earnings are backed by cash. However, free cash flow growth is sharply negative in the TTM period (about -4.8x), and cash conversion has been inconsistent historically (operating cash flow relative to net income was notably weak in FY2023–FY2024). Strong absolute cash flow, but with volatility that tempers the score.71
Positive
| Breakdown | TTM | Jun 2025 | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 16.58B | 16.30B | 13.98B | 14.91B | 13.97B | 12.91B |
| Gross Profit | 5.48B | 5.40B | 13.98B | 14.91B | 13.97B | 12.91B |
| EBITDA | 3.35B | 3.85B | 2.90B | 2.50B | 2.43B | 3.61B |
| Net Income | 1.89B | 2.26B | 1.50B | 1.24B | 1.21B | 2.15B |
Balance Sheet | ||||||
| Total Assets | 21.47B | 23.20B | 21.97B | 21.87B | 22.18B | 22.93B |
| Cash, Cash Equivalents and Short-Term Investments | 2.02B | 5.35B | 4.32B | 4.27B | 5.20B | 5.89B |
| Total Debt | 8.34B | 7.46B | 8.15B | 8.21B | 7.72B | 8.45B |
| Total Liabilities | 10.35B | 10.84B | 10.92B | 11.21B | 10.62B | 11.54B |
| Stockholders Equity | 10.93B | 11.96B | 10.71B | 10.38B | 11.34B | 11.12B |
Cash Flow | ||||||
| Free Cash Flow | 2.54B | 2.99B | 1.50B | 1.44B | 1.58B | 2.15B |
| Operating Cash Flow | 2.73B | 3.32B | 1.84B | 1.80B | 1.88B | 2.64B |
| Investing Cash Flow | -690.00M | -537.00M | -452.00M | -438.00M | -513.00M | -528.00M |
| Financing Cash Flow | -3.34B | -1.75B | -1.34B | -2.29B | -2.06B | -870.00M |
Fox Technical Analysis
Negative
57.74
Price Trends
65.37
Negative
65.71
Negative
61.33
Negative
Market Momentum
-1.75
Negative
40.77
Neutral
54.51
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FOXA, the sentiment is Negative. The current price of 57.74 is above the 20-day moving average (MA) of 56.92, below the 50-day MA of 65.37, and below the 200-day MA of 61.33, indicating a neutral trend. The MACD of -1.75 indicates Negative momentum. The RSI at 40.77 is Neutral, neither overbought nor oversold. The STOCH value of 54.51 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for FOXA.
Fox Risk Analysis
Fox disclosed 25 risk factors in its most recent earnings report. Fox reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Fox Peers Comparison
UnderperformOutperform
Sector (60)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $402.41B | 36.11 | 43.25% | ― | 15.49% | 35.54% | |
69 Neutral | $175.89B | 21.11 | 11.35% | 1.10% | 3.61% | 152.34% | |
68 Neutral | $23.21B | 34.54 | 16.22% | 0.75% | 14.91% | 9.30% | |
66 Neutral | $13.73B | 31.10 | 12.52% | 0.76% | -16.36% | 29.53% | |
64 Neutral | $13.51B | 180.68 | 3.40% | ― | 16.61% | 83.98% | |
62 Neutral | $67.31B | -70.76 | 2.05% | ― | -4.29% | ― | |
60 Neutral | $48.67B | 4.58 | -11.27% | 4.14% | 2.83% | -41.78% |
* Communication Services Sector Average
FOXA
Fox
57.39
5.60
10.82%
NWSA
News Corp
23.70
-3.08
-11.49%
DIS
Walt Disney
99.29
1.73
1.77%
NFLX
Netflix
95.31
3.51
3.82%
ROKU
Roku
91.65
23.87
35.22%
WBD
Warner Bros
27.14
16.95
166.34%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.