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Upon little news, News Corp shares declined -14% over the month, as a -4% decline in the NAV was compounded by a painful -580bps widening of the discount to 46%. This provides an opportune – if frustrating – moment to provide an update on a company that has been amongst AGT’s largest positions for the last 18 months.

We last wrote up the position in the March 2024 newsletter. At the time we explained that the investment case was predicated on the deep misunderstanding and undervaluation of News Corp’s unlisted stub assets, most notably Dow Jones, and the potential for management / the family to take steps to unlock value from the listed stake in REA Group, the value of which swamped News Corp’s market cap. At the time, we wrote that CEO Robert Thomson had explained that the company was in “serious introspection about structure…[and] how to fully monetize a precious, prestigious portfolio…That is indeed not an evolution, but a revolution”.

Well – much to our disappointment – the events to date look more like the Russian Revolution of 1905 than of 1917. There have been some small steps toward value realisation. At the end 2024 the company exited Foxtel – admittedly at a higher than anticipated valuation, albeit tempered by the fact the consideration was paid in DAZN’s unlisted equity. In July 2025, the company announced a new and enlarged buyback program equivalent to c.7% of then-market cap.

However, REA – the stake which accounts for 75% of News Corp’s market cap – remains the elephant in the room and central to any steps to unlock value and narrow the discount. Management continues to talk the talk – stating recently that “as for further strategic moves, the concentrated contemplation continues” – however the market continues to place a low probability on such steps being taken.

We are encouraged that one potential impediment to this has now been resolved. In September, it was announced that an agreement had been reached amongst the warring parties in the family, following legal proceedings in Nevada, related to the Murdoch Family Trust (MFT).

Under the agreement the three wantaway siblings (Prudence, Elisabeth and James) have monetised their portion of the MFT, leaving Lachlan (and Grace and Chloe) as beneficiaries of the new controlling Trust, which owns 34% of News Corp’s B shares.

In our view, a resolution of the on-going succession battle was likely always a prerequisite for structural reform, all else equal this development makes the probability of steps being taken to unlock value higher. With that said – as the last two years prove – predicting the timing of such events remains a futile task, with the family firmly in control.

In such situations, it is critical to our approach that the NAV side of the equation can work in our favour, whilst we wait for the event. In this vein we remain optimistic. Results for the quarter ending June 2025 showed continued positive progress at Dow Jones (37% of NAV), where revenues grew +7% and EBITDA +13%. The Professional Information Business (“PIB”) is performing strongly (+10%), underpinned by Dow Jones Risk & Compliance (+21%) and Dow Jones Energy (+12%). As PIB grows as a proportion of the overall business, margins push higher, now at 25% vs. 13% in 2019, with incremental margins of c.45%. Given the higher growth nature of PIB, we expect this to continue in the years ahead, driving earnings growth for Dow Jones.

This growth and value remain poorly reflected in News Corp’s share price. Net of the stake in REA, the implied value of the stub assets stands at $3.3bn, or approximately 4.0x EBITDA for the coming year. We believe Dow Jones alone is worth ~3x the entire stub and note that the New York Times trades at 15x and Information Services peers at 20x. Whilst timing remains uncertain, prospective returns from the family and management taking steps to narrow this discount and unlock value appear compelling.

Upon little newsflow, News Corp shares declined -14% over the month, as a -4% decline in the NAV was compounded by a painful -580bps widening of the discount to 46%. This provides an opportune – if frustrating – moment to provide an update on a company that has been amongst AGSS’ largest positions since the funds launch.

This will be the first time we have written about News Corp for the fund, however we have written about it in our sister fund, AVI Global Trust, on a couple of occasions, in April 2023 and March 2024.

At the time we explained that the investment case was predicated on the deep misunderstanding and undervaluation of News Corp’s unlisted stub assets, most notably Dow Jones, and the potential for management / the family to take steps to unlock value from the listed stake in REA Group, the value of which swamped News Corp’s market cap. At the time, we wrote that CEO Robert Thomson had explained that the company was in “serious introspection about structure…[and] how to fully monetize a precious, prestigious portfolio…That is indeed not an evolution, but a revolution”.

Well – much to our disappointment – the events to date look more like the Russian Revolution of 1905 than of 1917. There have been some small steps toward value realisation. At the end 2024 the company exited Foxtel – admittedly at a higher than anticipated valuation, albeit tempered by the fact that the consideration was paid in DAZN’s unlisted equity. In July 2025, the company announced a new and enlarged buyback program equivalent to c.7% of then-market cap.

However, REA – the stake which accounts for 75% of News Corp’s market cap – remains the elephant in the room and central to any steps to unlock value and narrow the discount. Management continues to talk the talk – stating recently that “as for further strategic moves, the concentrated contemplation continues” – however the market continues to place a low probability on such steps being taken.

We are encouraged that one potential impediment to this has now been resolved. In September, it was announced that an agreement had been reached amongst the warring parties in the family, following legal proceedings in Nevada, related to the Murdoch Family Trust (MFT). Under the agreement the three wantaway siblings (Prudence, Elisabeth and James) have monetised their portion of the MFT, leaving Lachlan (and Grace and Chloe) as beneficiaries of the new controlling Trust, which owns 34% of News Corp’s B shares.

In our view, a resolution of the on-going succession battle was likely always a prerequisite for structural reform, all else equal this development makes the probability of steps being taken to unlock value higher. With that said – as the last two years prove – predicting the timing of such events remains a futile task, with the family firmly in control.

In such situations, it is critical to our approach that the NAV side of the equation can work in our favour, whilst we wait for the event. In this vein we remain optimistic. Results for the quarter ending June 2025 showed continued positive progress at Dow Jones (36% of NAV), where revenues grew +7% and EBITDA +13%. The Professional Information Business (“PIB”) is performing strongly (+10%), underpinned by Dow Jones Risk & Compliance (+21%) and Dow Jones Energy (+12%). As PIB grows as a proportion of the overall business, margins push higher, now at 25% vs. 13% in 2019, with incremental margins of c.45%. Given the higher growth nature of PIB, we expect this to continue in the years ahead, driving earnings growth for Dow Jones.

This growth and value remain poorly reflected in News Corp’s share price. Net of the stake in REA, the implied value of the stub assets stands at $3.3bn, or approximately 4.0x EBITDA for the coming year. We believe Dow Jones alone is worth ~3x the entire stub and note that the New York Times trades at 15x and Information Services peers at 20x. Whilst timing remains uncertain, prospective returns from the family and management taking steps to narrow this discount and unlock value appear compelling.

Whilst the current structure was established in 2013, News Corp’s relevant history dates back to 1952, when a 21-yearold Rupert Murdoch returned to Australia from Oxford to take over what was left of his father’s newspaper business, which had been much diminished by death duties and taxes. From this he built one of the most dominant media empires of the 20th – and indeed 21st – century, amassing vast wealth and notoriety in the process.

Today we believe that News Corp is one of the most misvalued and misunderstood companies in our investment universe, trading at a 40% discount to our estimated NAV. The NAV is principally comprised of the following assets: a 62% listed stake in REA Group (41% of NAV), the Australian real estate classified marketplace, and unlisted assets Dow Jones and HarperCollins accounting for 39% and 9%, respectively.

In particular, Dow Jones is a crown jewel asset that has successfully evolved the Wall Street Journal into a thriving digital consumer business, whilst both organically and inorganically building a high-quality Professional Information business that warrants a premium multiple, reflective of its sticky growing revenues, high margins, and minimal capex requirements. The 2021 acquisition of OPIS for $1.1bn marks a step-change in the importance and materiality of Dow Jones’ Professional Information business. Despite improved disclosure and impressive margin expansion, the value and quality of this business is misunderstood by the sell side and ignored by the market.

Indeed, we certainly do not believe these attractions are captured in News Corp’s current valuation, with the company trading at a 40% discount to our estimated NAV. Adjusting for the stake in REA, the stub trades at an implied value of $5.1bn, or approximately 4.7x next year’s EBITDA. We estimate that Dow Jones alone is worth ~1.6x the implied stub value and note that the New York Times at 18x and Info Services peers which trade between 19-28x.

Management have become increasingly vocal about the undervaluation and dissatisfaction with the sum-of-the-parts discount at which it trades. As CEO Robert Thomson described on the last earnings call, the company is engaged in “serious introspection about structure…[and] how to fully monetize a precious, prestigious portfolio that has an obvious growth trajectory. That is indeed not an evolution, but a revolution”. There are numerous potential forms this could take, but the most obvious and tantalising relates to the stake in REA Group, which accounts for a whopping 68% of News Corp’s market cap.

At current prices, the market is seemingly ascribing a low probability to “a revolution”, with significant upside if management do indeed take concrete and tangible steps to unlock value. Combined with strong operating and earnings momentum, prospective returns appear attractive. Moreover – and this is key – the attractive underlying nature of the NAV means that we can afford to be patient and makes time our friend. All told returns from NAV growth and discount narrowing appear attractive.

We started building a position in News Corp last year and wrote it up in the April 2023 newsletter, highlighting the deeply discounted valuation and the overlooked quality and prospects for Dow Jones generally, and its Professional Information Business (“PIB”) specifically. In recent months we have added to the position such that it is now our largest position (6.7% of NAV). In February, News Corp reported a solid set of results which have seen the shares rise +8% subsequently. For the quarter ending December 2023, group EBITDA (which includes the consolidated stake in REA Group) increased by +16%, some +12% ahead of consensus expectations.

Results showed the strong continued evolution of Dow Jones (37% of NAV), where revenues grew +4% and EBITDA +17% as margins expanded +320bps to 27.9%. The key driver here was PIB, where revenues grew +13%, led by Dow Jones Risk & Compliance and Dow Jones Energy. We argued last year that that these assets were overlooked by the market and misunderstood by the sell side, who carried Dow Jones at derisorily low multiples in their sum-of-the-parts (“SOTP”) models, and for whom the ramp up in margin and evolution of business quality was missed. The margin impact is coming through and investors – aided by improved disclosure – are starting to appreciate the attractive nature of these sticky, largely recurring and high margin revenue businesses. We note that sell side analysts have started to increase the multiple at which they carry Dow Jones in their SOTP models, but the prospects and value of these businesses remains overlooked by many. Indeed, we certainly do not believe these attractions are captured in News Corp’s current valuation, with the company trading at a 38% discount to our estimated NAV.

Adjusting for the stake in REA, the stub trades at an implied value of $5.4bn, or approximately 4.7x next year’s EBITDA. We estimate that Dow Jones alone is worth ~1.6x the implied stub value and note that the New York Times at 15x and Info Services peers which trade between 19-29x. Management have become increasingly vocal about the undervaluation. As CEO Robert Thomson described on the last earnings call, the company is engaged in “serious introspection about structure…[and] how to fully monetize a precious, prestigious portfolio that has an obvious growth trajectory. That is indeed not an evolution, but a revolution”.

At current prices, the market is seemingly ascribing a low probability to “a revolution”, with significant upside if management do indeed take concrete and tangible steps to unlock value. Combined with strong operating and earnings momentum, prospective returns appear attractive.

Over the last few months, we have built a position in News Corp – the Murdoch family-controlled holding company.

Whilst the current structure was established in 2013, the relevant history dates back to 1952, when a 21-year-old Rupert Murdoch returned to Australia from Oxford to take over what was left of his father’s newspaper business, which had been much diminished by death duties and taxes. From this he built one of the most dominant media empires of the 20th – and indeed 21st – century, amassing vast wealth and notoriety in the process.

Today we believe that News Corp is one of the most misvalued and misunderstood companies in our investment universe, trading at a 52% discount to our estimated NAV. The NAV is principally comprised of the following assets: a 62% listed stake in REA Group (36% of NAV), the Australian real estate classified marketplace, and unlisted assets Dow Jones, HarperCollins and Move accounting for 37%, 13%, and 8%, respectively.

In particular, Dow Jones is a crown jewel asset that has successfully evolved the Wall Street Journal into a thriving digital consumer business, whilst both organically and inorganically building a high-quality Professional Information business that warrants a premium multiple, reflective of its sticky growing revenues, high margins, and minimal capex requirements. The 2021 acquisition of OPIS for $1.1bn marks a step-change in the importance and materiality of Dow Jones’ Professional Information business. The value and quality of this business is misunderstood by the sell side and ignored by the market.

We estimate that Dow Jones alone is worth 2.5x News Corp’s stub value. The stub trades at just 3.1x EBITDA, with EBITDA expected to grow at high single-digit to low double-digit rates in the years ahead. This compares to the S&P Communication Services sector median multiple of 10.1x, the New York Times at 16.7x and Information Services peers at 22.3x.

Management is highly aware of, and dissatisfied with, the current valuation. Although not consummated, the recent proposed sale of Move (8% of NAV) indicates a willingness to make structural changes to unlock value, with multiple potential levers.  These include the sale of Move, a monetisation of Foxtel, increased disclosure at Dow Jones – or, most tantalisingly, some form of value unlock at REA Group, which accounts for 75% of News Corp’s market cap. Whilst timing is uncertain, the attractive underlying nature of the NAV means that we can afford to be patient and makes time our friend. Returns from NAV growth and discount narrowing appear attractive.