Fox Corporation (NASDAQ:FOXA)(NASDAQ:FOX)-owned Fox News agreed to end its two-year-long defamation case with Dominion Voting Systems right before the start of the six-week-long trial. Fox agreed to pay $787.5 million to settle the legal battle.
The voting machine company sued Fox, seeking $1.6 billion in damages. Dominion said that the media and entertainment giant defamed it and spread false information about how its machines affected the 2020 presidential election.
Fox stock fell about 1.25% in after-hours trade as the settlement amount is significant for the company, which generated a net income of $1.5 billion in the trailing twelve months. Further, Fox’s troubles could mount further as the company faces a similar kind of defamation lawsuit from Smartmatic, a voting machine company. Smartmatic has sued Fox, seeking $2.7 billion in damages.
Earlier this month, Argus analyst Joseph Bonner downgraded the shares of Fox Corporation to Hold from Buy. The analyst said that the Dominion Voting Systems case increases the downside risk for the stock.
Furthermore, Bonner added that the macro uncertainty could weigh on TV ad revenues and adversely impact the company’s overall financials in 2023.
While Fox faces challenges, let’s check what Wall Street recommends about its stock.
Is FOXA Stock a Buy?
Wall Street analysts are cautiously optimistic about FOXA stock. It has received four Buy and seven Hold recommendations for a Moderate Buy consensus rating. Analysts’ average price target of $37.90 implies 11.47% upside potential.
