News Corp (NWSA) is a global media conglomerate with renowned and highly valuable content, cable, information services and publishing assets. We believe that News Corp, which was spun-off from 21st Century Fox last summer, is being misperceived and inappropriately valued as a print newspaper publisher. To the contrary, our research suggests that the significant majority of News Corp’s fair value is supported by its ownership positions in high quality cable sports networks, pay TV and digital content properties that enjoy dominant market share and compelling growth profiles. Continued subscriber and advertising growth coupled with the transition from print to digital media across various operating subsidiaries should drive consistent margin expansion over the next several years. Selling at a significant discount to our estimate of intrinsic value and at only a modest premium to tangible book value, we think News Corp offers a compelling risk/reward profile.
From Bill Nygren (Trades, Portfolio)'s Second Quarter 2014 Shareholder Letter.
