Is News Corp's Aggressive Buyback Strategy a Hidden Catalyst for Long-Term Shareholder Value?

In November 2025, News Corp unveiled a $1 billion stock repurchase program, signaling a bold commitment to strategic capital allocation, as reported by TradingView. This move, executed through Goldman Sachs & Co. LLC, targets both Class A and B shares and aligns with the company's broader focus on digital growth and shareholder returns. With the media landscape evolving rapidly, the question arises: Is this buyback strategy a prudent use of capital or a speculative gamble?

Strategic Allocation: Leveraging Digital Growth and EBITDA Momentum

News Corp's Q1 2026 earnings report provides critical context. Revenue rose 2% year-over-year to $2.14 billion, surpassing analyst expectations, while earnings per share (EPS) hit $0.22-$0.04 above forecasts, according to Finimize. The digital segments, particularly Dow Jones and Digital Real Estate Services, drove this performance, with EBITDA increasing by 10% and 9%, respectively, as noted in Yahoo Finance. These figures underscore the company's ability to generate scalable, subscription-based income-a foundation for sustained buyback funding.

The buyback program itself has already accelerated, with News Corp repurchasing shares at a rate of $2.5 million per day-over four times last year's pace, as Finimize reported. This aggressive approach reflects confidence in the company's financial health and its ability to deploy capital effectively.

Valuation Metrics: A Compelling Case for Accretion

News Corp's valuation metrics further justify the buyback rationale. As of October 31, 2025, the company's price-to-earnings (P/E) ratio stood at 37.44, below its 12-month average of 43.26, according to Public. This suggests the stock may be undervalued relative to its historical trajectory. Meanwhile, the debt-to-equity ratio of 22.36%Key Ratios | News Corporation indicates a conservative leverage profile, allowing room for continued buybacks without overexposing the balance sheet.

Comparisons to industry peers, though limited, highlight News Corp's relative strength. For instance, Permian Resources Corp (PR), a non-media peer, reported a debt-to-equity ratio of 0.17 in Q3 2025, according to Yahoo Finance, but its free cash flow of $469 million dwarfs News Corp's. In contrast, Thomson Reuters, a business services firm, maintains a P/E of 43.02, as reported in GuruFocus, suggesting News Corp's 37.44 P/E is more attractive for value-conscious investors. While direct media/entertainment sector averages remain elusive, News Corp's metrics appear favorable against a backdrop of mixed sector performance.

Analyst Sentiment and Long-Term Outlook

Analyst optimism reinforces the buyback's strategic merit. No "sell" ratings exist for News Corp, and the median price target of $38-a 30% premium to the current share price-reflects strong confidence in its digital transformation, as Finimize noted. This optimism is rooted in News Corp's ability to monetize its digital assets, such as subscription-based news platforms and real estate services, which offer recurring revenue streams less vulnerable to macroeconomic volatility.

Conclusion: A Catalyst for Shareholder Value

News Corp's buyback strategy, underpinned by robust digital growth, conservative leverage, and a favorable P/E ratio, positions it as a compelling catalyst for long-term shareholder value. While industry peer data remains sparse, the company's financial discipline and analyst consensus suggest the program is both timely and accretive. For investors, the key takeaway is clear: News Corp is not merely returning capital-it is strategically reallocating it to unlock latent value in a rapidly evolving media landscape.