Fox vs Netflix: Which Stock Offers Greater Value?

Fox and Netflix both hold a Zacks Rank of #2 (Buy), indicating positive earnings outlooks. However, with superior valuation metrics, Fox (FOXA) stands out as the better value investment compared to Netflix (NFLX).

Date: 22-03-2025

AI Rating: 7

Valuation Metrics Favor Fox

According to the analysis, both Fox (FOXA) and Netflix (NFLX) are currently rated as strong buy options, carrying a Zacks Rank of #2. This ranking indicates that both companies have experienced positive earnings estimate revisions, which reflects an improving earnings outlook. However, for value investors, it is essential to look beyond just rankings and examine traditional metrics that can indicate undervaluation.

Notably, Fox has a forward P/E ratio of 11.97, which is significantly lower than Netflix's forward P/E of 38.64. This difference suggests that Fox is more reasonably valued in terms of its earnings potential compared to Netflix. Additionally, Fox's PEG ratio of 1.16 indicates a more attractive valuation when considering earnings growth, contrasted with Netflix's PEG ratio of 1.97.

Another important metric is the P/B ratio. Fox's P/B ratio stands at 2.05, indicating a favorable market value to book value ratio compared to Netflix's much higher P/B of 16.42. This suggests that investors are currently valuing Fox's assets more conservatively compared to Netflix.

As a result of these valuation metrics, Fox has earned a Value grade of B, while Netflix has received a poorer Value grade of F. This clear divergence in value metrics paints a compelling picture for investors considering which of these two stocks presents a better opportunity, especially for those interested in undervalued stocks.

Stocks: FOXA NFLX