21st Century Fox
How Deutsche Bank's Economic Returns Model, a market-based DCF, turns a WACC and a free cash flow yield into an implied equity return.
- Rating
- Price target
- USD 42.00
- Published
- March 4, 2015
- Length
- 17 pages
- Sector
- Media & Entertainment
- Market
- US
What the analyst argued
Deutsche Bank argued Fox had the highest three-year profit growth outlook among the big five diversified media companies, driven by domestic affiliate fee and retransmission renewals, international pay-TV growth, and operating leverage on content and sports-rights investments made in 2014-15. EBITDA growth was forecast at 4-5% in 2015, accelerating to 12% in 2016 and 14% in 2017. After a volatile year of forex, ratings and cord-cutting worries that forced guidance lower, the analysts saw the bar reset low enough for a Buy at $42, using their Economic Returns Model (a market-based DCF with an 8.8% WACC).
Lead analysts: Bryan Kraft, Sunny Kwak, Clay Griffin.
Inside the report
- 01Investment Thesis
- 02Outlook
- 03Valuation
- 04Risks
- 05Attractive Asset Mix
- 06Scale Producer and Distributor of Film and TV Content
- 07Forecast Discussion
- 08Forecast and PT
- 09Economic Returns Model
- 10Comparable Company Valuations
- DCF
- P/E
- EV/EBITDA
- Comparable companies
Includes a multi-year earnings model with the income statement, balance sheet, and cash flow forecasts the valuation is built on.
Read the report
17 pages
Tap the cover to open the PDF.Published by Deutsche Bank on March 4, 2015 and hosted here for educational use; the report and everything in it belongs to Deutsche Bank. The rating, estimates, and price target are the analysts’ view on that date, more than a decade ago, and are not a recommendation today. Copy first uploaded October 5, 2026.
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