Highlights

  • News Corporation is trading at AUD 41.83 on 15 May 2026, down 18.60% over the past year, despite delivering a Q3 FY26 result that showed 9% Revenue growth and 18% EBITDA growth year-over-year.
  • Macquarie Research rates News Corp Outperform with a target price of AUD 46.25, implying approximately 10.6% upside from the current share price and reflecting confidence in the company's diversified Earnings streams.
  • Q3 FY26 results showed total revenues of USD 2.19 billion, driven by strong growth at Dow Jones, Digital Real Estate Services (including REA Group), and Book Publishing, with adjusted EPS improving from USD 0.17 to USD 0.21.

News Corporation (ASX:NWS) presents one of the more intriguing disconnects on the ASX: a diversified global media and information services Business delivering consistent earnings growth, yet trading 18.60% below its price of twelve months ago. At AUD 41.83 on 15 May 2026, the stock has failed to capture the enthusiasm of the broader market, despite a third quarter result for fiscal 2026 that would be considered strong by any measure. Revenue grew 9%, EBITDA rose 18%, Net Income from continuing operations increased 13%, and adjusted Earnings Per Share improved markedly — and yet the share price tells a different story.

Macquarie Research sees this gap between operational performance and market pricing as an opportunity. The broker's Outperform rating with a target price of AUD 46.25 reflects a view that the market is not yet fully appreciating the quality of News Corp's earnings mix, the trajectory of its digital businesses, and the embedded value of its 61% stake in REA Group. Understanding why Macquarie is constructive requires a careful look at the Q3 results announced on 7 May 2026.

Q3 FY26: The Numbers Behind the Outperform Rating

News Corporation's fiscal 2026 third quarter results covered the three months ended 31 March 2026. Total revenues came in at USD 2.19 billion, a 9% increase compared to USD 2.01 billion in the prior year period. This growth was primarily driven by higher real estate revenues within the Digital Real Estate Services segment, increased circulation and subscription revenues at Dow Jones, and strong sales at Book Publishing. The results included an USD 88 million, or 5%, positive impact from foreign currency fluctuations, with adjusted revenues — excluding the FX impact — growing 4%.

Total Segment EBITDA reached USD 343 million, an 18% increase compared to USD 290 million in the prior year — a growth rate that significantly outpaces revenue, suggesting improving margins across the portfolio. Net income from continuing operations rose to USD 121 million from USD 107 million. Reported earnings per share from continuing operations were USD 0.16 compared to USD 0.14 in the prior year, while adjusted EPS — which strips out non-recurring items — improved from USD 0.17 to USD 0.21.

Dow Jones: Risk and Compliance Leading the Way

The Dow Jones segment delivered revenues of USD 619 million in Q3 FY26, an 8% increase compared to the prior year. The standout performer within Dow Jones was Risk and Compliance, which recorded 19% growth — a reflection of the surging enterprise Demand for compliance data and workflow tools in an environment of expanding global regulatory requirements. Dow Jones Energy contributed 12% revenue growth, while digital Advertising revenues at Dow Jones grew 13% year-over-year.

The importance of the Dow Jones business to News Corp's overall quality narrative cannot be overstated. The segment has been methodically building a portfolio of subscription and data services that carry higher margins, greater revenue predictability, and lower cyclical exposure than traditional print and digital media. Risk and Compliance in particular is operating in a market with strong structural tailwinds, and its near-20% growth rate positions Dow Jones as a genuine data and analytics business rather than simply a news organisation.

Digital Real Estate: REA Group Drives Strong Results

The Digital Real Estate Services segment — which consolidates News Corp's majority interest in REA Group and its Equity stake in Move, Inc., the operator of realtor.com — was a significant contributor to the strong Q3 result. REA Group posted a particularly impressive quarter from News Corp's reporting perspective, growing revenues 20% to USD 325 million. This growth reflected both the strong underlying operational performance of the Australian property portal business — including 12% residential revenue growth, record audiences, and double-digit Yield expansion — as well as a positive foreign exchange tailwind as the Australian dollar moved in REA Group's favour relative to the USD reporting currency.

Move, the operator of realtor.com in the United States, also contributed positively, with revenues reaching USD 148 million — a 10% increase from the prior year. This improvement was driven by higher sales of premium RealPRO Select products as Move continues to shift its mix toward higher-value offerings, and by revenue growth in Seller, New Homes, and Rentals categories. While Move remains an equity-accounted Investment for News Corp at 20% economic interest, its improving revenue trajectory is a meaningful positive signal for the longer-term value of this stake.

Book Publishing: A Surprise Bright Spot

HarperCollins, News Corp's Book Publishing division, delivered revenues of USD 555 million for Q3 FY26, an 8% increase from the prior year. The growth was led by strong sales tied to Rachel Reid's Game Changers series, which received a boost from the release of the related Heated Rivalry streaming series. This is a useful reminder that the book publishing business, while traditionally viewed as a slow-growth segment, retains the ability to generate spikes in revenue when intellectual property translates successfully across media formats — a dynamic that the broader entertainment industry is increasingly focused on monetising.

Book Publishing has been one of the more consistent contributors to News Corp's earnings through periods of market Volatility, providing a meaningful offset to the cyclicality of advertising-dependent revenues elsewhere in the group. Its contribution to the Q3 result is therefore not merely about the absolute revenue figure but about the quality of the earnings Diversification it provides.

The Broader News Corp Narrative: A Business in Transformation

News Corporation's investor story has for several years been one of managed transition — from a conglomerate anchored in traditional print and broadcast Assets to a diversified information services and digital real estate business. The Q3 FY26 result demonstrates how far that transformation has progressed. The fastest-growing businesses within the portfolio — Dow Jones Risk and Compliance, REA Group, realtor.com — are all technology-enabled, subscription or advertising-supported platforms with meaningful network effects and competitive moats. These are not the revenue streams of a legacy media company; they are the building blocks of a modern information business.

Yet the market has not fully re-rated News Corp to reflect this reality, which is essentially the core of Macquarie's Outperform thesis. The broker appears to see a gap between News Corp's reported operating performance and the market's persistent perception of the company through the lens of its legacy media assets — a lens that, increasingly, may not tell the full story.

Conclusion

News Corporation's Q3 FY26 result was, by most objective measures, an impressive demonstration of the company's diversified earnings power. Revenue grew 9%, EBITDA rose 18%, and adjusted EPS improved materially year-over-year. The market's 18.60% decline in the stock over the past twelve months appears to reflect broader concerns about legacy media exposure and macroeconomic uncertainty rather than a sober assessment of the underlying business quality. Macquarie's Outperform rating at AUD 46.25 encapsulates a view that this disconnect will eventually close — and that investors who examine the actual earnings trajectory rather than the headline perception may find a media and information business that has been quietly building something quite compelling.