Rupert Murdoch has spent his lifetime not just accumulating massive wealth for himself but he's also accumulated a suite of flagship media assets including cable television station Fox, film production house Twenty First Century Fox, book publisher HarperCollins, and newspaper mastheads including The Australian, Wall Street Journal and pay-television operator Foxtel which is held in a 50%/50% partnership with Telstra Corporation Ltd (ASX: TLS).
While in the past, ASX investors enjoyed easy access to this entire suite of brand name media assets, the catch these days is that the assets are split between News Corp (ASX: NWS) – which has an ASX listing – and the US-listed Twenty-First Century Fox Inc.
Interestingly, since this split occurred in 2013, it would seem fair to say that News Corp as a stand-alone business has received a lot less press! The most likely explanation for News Corp dropping off investors' radars is because the stock it viewed as housing all the 'old world' media assets, with Fox housing all the sexy, modern, growth assets.
Investors need look no further than the share price performance of Fairfax Media Limited (ASX: FXJ) and Ten Network Holdings Limited (ASX: TEN) over the past few years to see how on the nose old world media companies are…
…at the right price however, most stocks shouldn't be ignored by value-seeking investors.
In fact, in the case of News Corp the stock's share price performance has actually been impressive with the share price outperforming the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) over both one year and post-split.
Newscorp recently announced the sale of Amplify which sees a loss making business moved on. The group's substantial shareholding in online real estate classifieds business REA Group Limited (ASX: REA) remains a highly appealing asset, while the book publishing unit continues to have solid prospects. Although the economics of newspapers are certainly not what they once were, the brand names still remain powerful and hold some value.
According to forecast data supplied by Morningstar, News Corp is expected to earn 83.5 cents per share in the 2017 financial year. With the shares last trading at $18.67, this implies a forward price-to-earnings ratio of 22 times.
