With shares of News Corp. (NASDAQ:NWSA) trading at around $25.49, is NWSA an OUTPERFORM, WAIT AND SEE or STAY AWAY? Let’s analyze the stock with the relevant sections of our CHEAT SHEET investing framework:
C = Catalyst for the Stock’s Movement
The next time there’s a phone-tapping scandal involving a sound and well-run company, be sure to look at it as a buying opportunity. News Corp is a company that has a way of fighting back regardless of the circumstances.
Looking ahead, don’t be surprised if New Corp increases its stake in the YES Network, which has grown quickly since its inception. The Yankees roster looks to be aging, and the team likely won’t be as competitive next season as it has been in the past, but the fans will still be there most of the way. A fight for the playoffs late in the season could draw more viewers than clinching a playoff spot early. The Brooklyn Nets have also become a big attraction in the metro area, which is yet another reason News Corp might go beyond its 49 percent stake. Could the Brooklyn Nets be the next Los Angeles Lakers? Their marketing has been stupendous thus far. Also be on the lookout for “Parental Guidance.” This is a Fox Studio movie starring Billy Crystal and Bette Midler. As you might have guessed, it’s a comedy.
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Getting to some numbers, News Corp has a Forward P/E of 12.80, a profit margin of 7.89 percent, and an operating cash flow over $4 billion. Those are all comforting numbers. Let’s take a look at some more important numbers.