News, sports, and entertainment company Fox Corp. (FOXA) has agreed to acquire digital media platform, Outkick Media.
Outkick provides content on sports, opinion, politics, and pop culture via radio, podcasts, online and social media. The platform also provides sports betting information in the US and has an exclusive marketing partnership with Fox partner FanDuel, which acts as a funnel for sport betting leads.
Fox Corp. Executive Chairman and CEO Lachlan Murdoch said, “As Fox further diversifies our growing digital portfolio and broadens our position in the sports wagering ecosystem, there could be no better acquisition than Outkick.” (See Fox Corp stock analysis on TipRanks)
Outkick Founder Clay Travis added, “Outkick has grown out of my passion for producing bold, well-informed, and entertaining content about sports, current events, and, more recently, sports wagering. With the power of FOX behind us, we look forward to maintaining Outkick’s unwavering commitment to that mission.”
Travis’ sports radio show attracts 10 million monthly listeners and Outkick podcast network (launched in September 2020) garners over 4 million downloads of monthly episodes.
Upon acquisition, Outkick will operate as an independent brand. Fox will distribute Outkick content across its current platforms.
Fox Corp. reported results for 3Q 2021 on May 5. Owing to a drop in advertising sales, its revenue declined 6.7% year-on-year to $3.21 billion but came in ahead of consensus estimates by $60 million. Non-GAAP earnings per share were $0.88, beating analysts’ estimates of $0.50.
On May 6, Loop Capital Markets Analyst Alan Gould reiterated a Buy rating on the stock and increased the price target to $50 (33.1% upside potential) from $36.
Noting Fox’s 3Q showing as “Strong”, Gould commented that the current market valuation for the stock does not fully incorporate the value of its gaming assets.
Consensus among analysts is that Fox Corp. is a Moderate Buy based on 8 Buys, 6 Holds, and 1 Sell. The average analyst price target of $41.54 implies 10.6% upside potential. Shares have gained about 50.8% over the past year.
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