Fox Corporation (FOXA): A Bull Case Theory

We came across a bullish thesis on Fox Corporation on Accrued Interest’s Substack by Simeon McMillan. In this article, we will summarize the bulls’ thesis on FOXA. Fox Corporation’s share was trading at $55.76 as of July 31st. FOXA’s trailing and forward P/E were 13.73 and 12.76, respectively according to Yahoo Finance.

A close up of a television broadcasting a popular show produced by the company.

Fox Corporation (FOX/FOXA) is positioned as a compelling outperform candidate over the next 18–24 months, driven by a deeply undervalued portfolio of hidden assets. The company owns a 19% stake in FanDuel and 2.4% in its parent, Flutter Entertainment (FLUT), yet these are not fully reflected in the current share price of $56.25 as of July 18th.

FOX trades at a modest 12.7x EV to 2027 FCF, well below peers trading at 14x–24x, largely due to investor bias linking its fate to declining linear television. However, this view misses the resilience of FOX’s core assets—its dominant cable news network, FOX News, and its live sports focus via FOX Sports. FOX is also gaining share in free ad-supported streaming TV (FAST) through Tubi, which now commands 2.2% of U.S. TV viewership, outperforming services like Peacock and Paramount+.

Though not yet profitable, Tubi is expected to reach 20–25% EBITDA margins in five years, positioning it as a future growth engine. On the gambling front, FOX holds a valuable option to acquire an 18.6% stake in FanDuel and owns $1.3 billion in Flutter equity. Conservative modeling suggests these assets are worth $8–$10 per share today and $12.34 by 2027.

Valuing FOX’s non-gambling assets at a WBD-like 13.5x FCF multiple implies a fair equity value of $68–$72 per share, a 20%–29% upside. With a strong balance sheet (1x net debt/EBITDA) and increasing investor awareness of its underappreciated streaming and gambling assets, FOX offers a favorable risk/reward skew with catalysts on the horizon, including a likely FanDuel monetization.

Previously, we covered a bullish thesis on Madison Square Garden Sports Corp. (MSGS) by Boyar Research in October 2024, which highlighted the significant valuation gap between MSGS’s market cap and the estimated worth of its Knicks and Rangers franchises. The company’s stock price has depreciated by approximately 2.98% since our coverage. Simeon McMillan shares a similar view but emphasizes hidden asset value within Fox Corporation.

Fox Corporation is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 44 hedge fund portfolios held FOXA at the end of the first quarter which was 44 in the previous quarter. While we acknowledge the risk and potential of FOXA as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than FOXA and that has 10,000% upside potential, check out our report about this cheapest AI stock.

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Disclosure: None.