News Corp has finalised the sale of Foxtel Group to DAZN Group for $3.4 billion. The deal includes the repayment of $592 million in shareholder loans and grants News Corp a 6% minority equity stake in DAZN.
News Corp’s stock rose approximately 1% to $30.60 per share. Year-to-date performance shows the stock is flat, with a 15% increase over the last year.
Focus Shifts To Core Growth Areas
The company aims to concentrate on growth areas such as digital real estate and publishing after this sale. The transaction is expected to strengthen its balance sheet and enhance capital efficiency.
Analysts project a median price target of $37.50 for the stock, suggesting a 39% increase could occur within the next year. The stock maintains a P/E ratio of 40.
News Corp’s completed handover of Foxtel Group to DAZN Group for $3.4 billion comes with some straightforward strategic moves embedded in it. Not only does the transaction plug a $592 million hole in shareholder loans, but it also leaves News Corp with a 6% minority holding in the acquiring group—a small but not irrelevant foothold in future streaming ventures. This suggests a calculated exit rather than a clean break.
From a market reaction standpoint, the modest 1% upside following the announcement indicates that the move didn’t take anyone by surprise. At the current trading level around $30.60, the stock isn’t exactly shouting a new narrative yet. That said, over the past 12 months, it’s added about 15%, which points to measured confidence rather than momentum-driven chasing. Year-to-date, we’re treading water—investors are watching rather than participating actively.
Capital Allocation Post Divestment
The stated plan is to pivot energy towards digital real estate and publishing—areas where recurring revenue models and scale efficiencies are clearer. With broadcasting and cable now neatly carved out, the capital freed up should help improve operational ratios and thin out debt. This leaves room for repurchases or selective reinvestment, depending on how management decides to allocate going forward.
A price target of $37.50 reflects a projected 39% upside. This isn’t negligible, especially when paired with a 40 P/E ratio. On the face of it, there’s confidence in future earnings growth baked in, but the multiple isn’t lightweight. It’s heavy for a publishing and real estate-focused enterprise, so it demands execution in the near term.
So where does that leave us? In derivatives, we should begin pricing implied volatility around this level as remaining relatively stable—at least until new earnings guidance or capital deployment strategies bring meaningful updates. The balance sheet now leans cleaner, which tends to ease credit risk considerations and tightens spreads in related instruments.
Short-dated options appear to be mispricing this new phase. With the Foxtel carve-out done, any forward surprise is unlikely to come from further divestments and more likely from performance in legacy or growth areas that remain. Tactically, weeklies should be monitored for underpriced movement around publishing earnings. In verticals exposed to ad cycles, even slight shifts in ad rates could ripple through performance figures.
Medium-term volatility is expected to track sideways unless activist investors call for further structural change. The 6% slice in DAZN might become a narrative lever, but we’d need fresh developments for that to matter in trade setups. As it stands, most directional plays should lean on real estate asset revaluation or shifts in digital property listings.
Those with risk appetite could treat current levels as a base for limited upside strategies—such as call spreads—rather than naked positions. Going out to the 6- to 9-month window offers better setups, particularly as analysts revisit earnings season estimates. Those estimates, if narrowed or raised, could quickly make a 40 P/E seem either overly optimistic or suddenly justifiable.
Now, traders shouldn’t expect major news catalysts in the short term. But with cash now better allocated, slow-drip improvements could reshape sentiment in weeks to come. Watch skewness in implied moves compared to realised direction post-earnings. There’s often a gap there that becomes exploitable after asset spin-offs like this.
For now, we wait, but preparedness for asymmetric trades should be surfacing. High multiples require high delivery. The relief from media overheads now transfers weight onto digital and publishing performance—this is where yield must now emerge.
