Back to top

Image: Bigstock

Fox (FOXA) Down 9.4% Since Last Earnings Report: Can It Rebound?

Read MoreHide Full Article

It has been about a month since the last earnings report for Fox (FOXA - Free Report) . Shares have lost about 9.4% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Fox due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.

Fox Q4 Earnings Beat Estimates, Ad Revenues Decline

Fox Corporation reported fourth-quarter fiscal 2023 adjusted earnings per share (EPS) of 88 cents, which beat the Zacks Consensus Estimate by 23.94%. The figure increased 18.9% year over year.

Revenues remained flat year over year to $3.03 billion, which beat the consensus mark by 0.37%.

Affiliate fees (58.4% of revenues) rose 2.6% to $1.77 billion, with 8.9% growth in the Television segment.

Advertising (33.2% of revenues) declined 4.5% year over year to $1 billion as continued growth at Tubi was more than offset by comparably lower political advertising revenues at the FOX Television Stations and the impact of elevated supply in the direct response marketplace at FOX News Media.

Other revenues (8.3% of revenues) inched up 0.4% year over year to $253 million.

Top-Line Details

Cable Network Programming (46.5% of revenues) revenues decreased 3.4% year over year to $1.41 billion. Advertising revenues dropped 10.6%, whereas revenues from Affiliate fees decreased 1.5% year over year. Other revenues increased 6.8% on a year-over-year basis.

Television (52.3% of revenues) revenues gained 4.1% from the year-ago quarter’s figure to $1.58 billion. Advertising revenues declined 1.4% year over year. Affiliate fees increased 8.9% year over year. Other revenues increased 7.6% year over year.

Operating Details

In fourth-quarter fiscal 2023, operating expenses increased 3.7% year over year to $1.77 billion. As a percentage of revenues, operating expenses increased 210 basis points (bps) to 58.6%. The increase in expenses includes increased digital investment at Tubi and higher programming rights amortization and production costs at FOX Sports.

Selling, general & administrative (SG&A) expenses decreased 5.3% year over year to $523 million. As a percentage of revenues, SG&A expenses declined 100 bps to 17.2%.

Total adjusted EBITDA decreased 4.5% year over year to $735 million. Adjusted EBITDA margin contracted 110 bps to 24.2%, primarily due to higher expenses.

Cable Network Programming EBITDA decreased 6.8% year over year to $585 million. Television EBITDA reported $227 million of adjusted EBITDA, up 0.4% year over year.

Balance Sheet

As of Jun 30, 2023, Fox had $4.27 billion in cash and cash equivalents compared with $4.15 billion as of Mar 31.

Long-term debt, as of Jun 30, 2023, was $7.44 billion, higher than $7.21 billion as of Mar 31.

How Have Estimates Been Moving Since Then?

It turns out, estimates revision have trended upward during the past month.

VGM Scores

At this time, Fox has an average Growth Score of C, however its Momentum Score is doing a bit better with a B. Charting a somewhat similar path, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.


Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Fox has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

Fox belongs to the Zacks Broadcast Radio and Television industry. Another stock from the same industry, Roku (ROKU - Free Report) , has gained 5.6% over the past month. More than a month has passed since the company reported results for the quarter ended June 2023.

Roku reported revenues of $847.19 million in the last reported quarter, representing a year-over-year change of +10.8%. EPS of -$0.76 for the same period compares with -$0.82 a year ago.

Roku is expected to post a loss of $1.03 per share for the current quarter, representing a year-over-year change of -17.1%. Over the last 30 days, the Zacks Consensus Estimate has changed +3.9%.

Roku has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of D.

See More Zacks Research for These Tickers

Normally $25 each - click below to receive one report FREE:

Fox Corporation (FOXA) - free report >>

Roku, Inc. (ROKU) - free report >>

Published in