Key Highlights
- JPMorgan and Wells Fargo elevated Fox Corp ratings to Overweight, setting new price targets at $82 and $80
- Television segment revenue surged 45% year-over-year in Q4 to $2.48 billion, while EBITDA soared 129% to $705 million
- Tubi reached 110 million monthly active users, posting 35% revenue growth and 17% increase in viewing hours
- Roku acquisition positioned to establish industry’s largest free ad-supported streaming television platform
- Wells Fargo projects $300 million in advertising synergies from Roku transaction within approximately two years
Shares of Fox Corp climbed approximately 4% on Friday to around $65.45 following consecutive rating upgrades from two prominent Wall Street financial institutions.
JPMorgan elevated its price objective to $82 from a previous $70, while Wells Fargo increased its target to $80 from $65. Both institutions upgraded Fox to Overweight from Neutral ratings.
Following the company’s fourth-quarter financial results, JPMorgan increased its fiscal 2027 and 2028 adjusted EBITDA projections by 7% and 9% respectively. The investment bank highlighted favorable FIFA World Cup revenue potential, robust political advertising prospects, and sustained advertising strength as primary growth catalysts.
Fox’s television division generated Q4 revenue of $2.48 billion, marking a 45% year-over-year increase. The segment’s EBITDA jumped 129% to reach $705 million.
The streaming platform Tubi delivered impressive quarterly performance with 35% revenue growth, supported by a 17% expansion in total viewing time. By the close of fiscal 2026, Tubi had accumulated 110 million monthly active users.
FIFA World Cup and Election Year Advertising Drive Projections
J.P. Morgan revised its fiscal 2027 television EBITDA forecast upward by 30% to $1.49 billion. The institution identified the 2026 FIFA World Cup and an anticipated historic political advertising cycle as primary revenue drivers.
Fox management indicated it will refrain from pursuing early renegotiation of its NFL media rights agreement. JPMorgan characterized this decision as eliminating a significant near-term uncertainty and strengthening the company’s bargaining leverage.
Wells Fargo adjusted its fiscal 2027 EBITDA projection to $4.12 billion from $3.85 billion. The firm now anticipates World Cup-related revenue approaching $800 million, surpassing its earlier forecast exceeding $600 million. Its television segment EBITDA estimate for fiscal 2027 increased to $1.6 billion from $1.3 billion.
Roku Acquisition Strengthens Investment Thesis
The proposed Roku acquisition represents a significant component of the enhanced analyst outlook. Merging Tubi with The Roku Channel would establish the market’s dominant free ad-supported streaming television operation.
JPMorgan indicated the transaction enhances Fox’s growth trajectory and addresses long-term valuation concerns. With Roku’s existing base exceeding 100 million streaming households, Fox would gain substantially expanded advertising inventory reach.
Wells Fargo projects the combination could yield approximately $300 million in advertising revenue synergies within roughly two years. These benefits would stem from enhanced pricing power, improved fill rates on Roku Channel inventory, homescreen advertising opportunities, and optimized monetization of third-party streaming content.
JPMorgan observed that Fox currently trades at 6.8 times enterprise value to EBITDA based on its updated fiscal 2028 forecast, below the recent multiple of approximately 8 times. The firm anticipates potential multiple expansion as the market increasingly values the combined entity as a comprehensive connected-TV platform.
InvestingPro data indicates five analysts have raised their earnings projections for the forthcoming period.
Get 3 Free Stock Ebooks
Discover top-performing stocks in AI, Crypto, and Technology with expert analysis.
- Top 10 AI Stocks - Leading AI companies
- Top 10 Crypto Stocks - Blockchain leaders
- Top 10 Tech Stocks - Tech giants
