News Corporation, the global media and information services company, announced on Monday that its subsidiary, REA Group Ltd, is considering a potential acquisition of the entire share capital of Rightmove (OTC:RTMVY) plc, the UK's largest property website. The announcement comes amid market speculation regarding the possible offer.
REA Group Ltd, which operates Australia's leading property website realestate.com.au, stated on September 2, 2024, addressing the rumors. The disclosure was made in compliance with market regulations and does not confirm the pursuit or completion of any deal. The details of the announcement were attached as an exhibit to News Corp (NASDAQ:NWSA)'s recent 8-K filing with the Securities and Exchange Commission (SEC).
The information provided in the SEC filing is not considered to be "filed" for regulatory purposes, nor is it incorporated by reference into any future filings under the Securities Act or the Exchange Act, unless explicitly referenced in such filings.
Shares of News Corporation are traded on the Nasdaq Global Select Market under the tickers NASDAQ:NWSA for Class A Common Stock and NASDAQ:NWS for Class B Common Stock.
The contemplation of this acquisition aligns with News Corp's strategy to expand its digital real estate services, leveraging its subsidiary's expertise and market presence. Rightmove plc, listed on the London Stock Exchange, is a key player in the online real estate listing industry, offering a significant foothold in the UK market.
This report is based solely on the factual information provided in a press release statement.
In other recent news, News Corporation has been actively executing its $1 billion stock repurchase program, buying back its Class A and Class B common stock. The program is part of News Corp's ongoing strategy to enhance shareholder value.
In the fourth quarter of fiscal year 2024, News Corp reported a 6% revenue increase to approximately $2.6 billion, with profitability rising by 11% to $380 million. This growth was largely driven by the company's diverse sectors, including its book publishing, digital real estate services, and Dow Jones segments.
Morgan Stanley (NYSE:MS) has updated its financial model for News Corp, leading to an increase in the stock price target from $31.00 to $35.00. However, the firm's earnings per share (EPS) estimates have been slightly reduced due to assumptions of higher minority interest and tax rates.
Despite a 5% decrease in revenues and a 38% drop in EBITDA in the News Media segment, News Corp is planning for fiscal 2025, focusing on streaming, B2B growth, and data offerings. These are some of the recent developments for News Corp.
InvestingPro Insights
As News Corporation explores strategic growth through potential acquisitions like Rightmove plc, investors are keenly observing the company's financial health and market performance. The latest data from InvestingPro reveals that News Corporation has a market capitalization of $16.35 billion, reflecting its significant presence in the media and information services sector. With a P/E ratio of 62.92, which adjusts to 46.34 on a last twelve months basis as of Q4 2024, the company's valuation measures show a high level of investor confidence in its earnings potential.
The company's revenue growth over the last twelve months as of Q4 2024 stands at 2.09%, with a quarterly increase of 5.92%, indicating a steady upward trajectory in its financial performance. Additionally, News Corporation's gross profit margin at 50.41% demonstrates its ability to effectively manage production and service costs, translating into robust profitability.
InvestingPro Tips suggest that News Corporation's PEG ratio of 0.79 points to a potentially undervalued stock in relation to its earnings growth, which could be a signal for investors looking for growth at a reasonable price. Furthermore, with a solid return on assets of 2.11% and a dividend yield of 0.71%, the company appears to reward shareholders while maintaining a healthy balance sheet. For those interested in deeper analysis, InvestingPro offers 12 additional tips that could provide further insight into News Corporation's investment potential.
As the digital real estate market continues to evolve, News Corporation's financial metrics and strategic movements will be crucial for investors to monitor. The contemplated acquisition of Rightmove plc could represent a significant step in the company's expansion and competitive positioning.
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