News Corp is reviewing its strategic options for News America Marketing, including a potential sale. Revenue has been under pressure in recent years, declining -6% in FY18. The business provides a range of marketing solutions to advertisers.
UBS notes similar transactions are scarce but suspects the market is undervaluing the traditional media assets in the company.
A potential sale would help simplify the structure of news and information services and could allow better visibility about the contribution from the remaining businesses in that segment. Buy rating and $21.25 target maintained.
Sector: Media.
Target price is $21.25.Current Price is $19.32. Difference: $1.93 – (brackets indicate current price is over target). If NWS meets the UBS target it will return approximately 9% (excluding dividends, fees and charges – negative figures indicate an expected loss).
