News Corp's share price has retreated from its August peak of $31.59 to the current $29.12, mirroring broader weakness in U.S. equities. The S&P 500 and Dow Jones remain well below their year-to-date highs, and the media conglomerate has not been immune to the selling pressure.
The company, which owns the Wall Street Journal, Barron's, MarketWatch, and Investor's Business Daily under its Dow Jones division, also controls HarperCollins Publishers, Realtor.com, REA Group, and several Australian and U.K. media brands. With a market capitalization exceeding $15 billion, News Corp is a significant player in the global media landscape.
Investors are now turning their attention to two key catalysts: the dismissal of a $10 billion lawsuit filed by President Donald Trump against the Wall Street Journal, and the upcoming quarterly earnings report. On Friday, U.S. District Judge Darrin Gayles tossed the lawsuit, ruling that it ran counter to the First Amendment's protections for press freedom. The suit stemmed from a letter the Journal published that was allegedly sent to Jeffrey Epstein.
While a $10 billion judgment would have been a major blow to News Corp, the dismissal was largely anticipated. Most analysts never expected the court to award the full amount, and the company could have opted to settle, as other firms have done in similar situations. Consequently, the market reaction on Monday is likely to be muted, with the stock potentially seeing only a modest uptick.
The more significant catalyst is the upcoming earnings report, which will offer fresh insights into the company's operational health. In its last fiscal year, News Corp reported a 7% increase in annual revenue to $9.03 billion, with free cash flow reaching $811 million. The fourth quarter alone saw revenue climb 11% to $2.34 billion, driven by strength in digital real estate services, book publishing, and Dow Jones.
For the first quarter of fiscal 2025, analysts project revenue of $2.26 billion, representing a 5.54% year-over-year increase. Earnings per share are expected to rise to 26 cents from 22 cents in the same period last year. These figures will be closely watched for signs of sustained momentum in the company's core segments.
From a technical perspective, News Corp's stock has formed a double-top pattern, a classic bearish reversal signal. The shares have slipped below the 50-day moving average and the 23.6% Fibonacci retracement level. If selling pressure persists, the next key support level is at $27.9. A break below that could open the door to further downside, potentially targeting the 50% retracement at $26.9.
While the dismissal of the lawsuit removes a legal overhang, the earnings report will likely dictate the stock's near-term direction. Investors will be evaluating whether the company can maintain its growth trajectory amid a challenging macroeconomic environment.
This article is for informational purposes only and does not constitute financial advice.
