Fox Corp is expected to benefit from a boost in advertising revenue linked to the ongoing FIFA World Cup, but its shares are likely to remain under pressure as investors focus on the company’s planned acquisition of Roku, according to BofA Securities.
The brokerage maintained its Underperform rating on the media company and kept its price target at $54, despite raising several financial forecasts ahead of Fox’s fiscal fourth-quarter earnings.
BofA increased its revenue estimate for the quarter to $3.64 billion, up from $3.59 billion, while leaving its EBITDA forecast unchanged at $984 million.
The firm expects Fox’s cable business to deliver 4.8% year-on-year revenue growth, while television revenue is projected to rise 17.1%, supported by stronger advertising demand surrounding the FIFA World Cup and increased subscriptions to the company’s Fox One streaming platform.
According to BofA, Fox continues to outperform much of the traditional television industry thanks to its portfolio of live sports and news programming, which remains attractive to advertisers and audiences alike.
However, the brokerage believes investor attention has shifted to Fox’s recently announced acquisition of Roku. While the transaction is expected to expand Fox’s presence in the fast-growing connected television market and generate long-term revenue and cost synergies, BofA said the stock is likely to remain in “deal limbo” until the acquisition moves closer to completion, which is expected during the first half of 2027.
Reflecting stronger expectations for cable advertising, BofA raised its fiscal 2027 EBITDA forecast to $3.93 billion from $3.86 billion. It also increased its earnings per share estimate for fiscal 2027 to $5.76, compared with its previous forecast of $5.63.
Despite the improved outlook, the brokerage retained its cautious stance on the stock. It cited Fox’s continued exposure to the declining linear television market and warned that substantially higher costs associated with the next renewal of National Football League media rights could weigh on earnings beyond fiscal 2027, limiting the company’s long-term upside.
