Twenty-First Century Fox Inc Class A (NASDAQ: DISCK) and Discovery Inc Series C (NASDAQ:DISCK) are both large-cap consumer discretionary companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, risk, analyst recommendations, profitability, dividends, valuation and earnings.

Earnings & Valuation

This table compares Twenty-First Century Fox Inc Class A and Discovery Inc Series C’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Twenty-First Century Fox Inc Class A $30.40 billion 2.73 $4.46 billion $1.97 22.75
Discovery Inc Series C $6.87 billion 2.25 -$337.00 million $2.24 13.19

Twenty-First Century Fox Inc Class A has higher revenue and earnings than Discovery Inc Series C. Discovery Inc Series C is trading at a lower price-to-earnings ratio than Twenty-First Century Fox Inc Class A, indicating that it is currently the more affordable of the two stocks.

Dividends

Twenty-First Century Fox Inc Class A pays an annual dividend of $0.36 per share and has a dividend yield of 0.8%. Discovery Inc Series C does not pay a dividend. Twenty-First Century Fox Inc Class A pays out 18.3% of its earnings in the form of a dividend. Twenty-First Century Fox Inc Class A has raised its dividend for 4 consecutive years.

Profitability

This table compares Twenty-First Century Fox Inc Class A and Discovery Inc Series C’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Twenty-First Century Fox Inc Class A 14.68% 18.71% 6.88%
Discovery Inc Series C -8.28% 17.68% 4.59%

Insider and Institutional Ownership

54.1% of Twenty-First Century Fox Inc Class A shares are owned by institutional investors. Comparatively, 56.1% of Discovery Inc Series C shares are owned by institutional investors. 20.3% of Twenty-First Century Fox Inc Class A shares are owned by company insiders. Comparatively, 5.0% of Discovery Inc Series C shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of current recommendations for Twenty-First Century Fox Inc Class A and Discovery Inc Series C, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Twenty-First Century Fox Inc Class A 0 8 10 0 2.56
Discovery Inc Series C 0 1 0 0 2.00

Twenty-First Century Fox Inc Class A presently has a consensus price target of $44.31, indicating a potential downside of 1.11%. Discovery Inc Series C has a consensus price target of $29.00, indicating a potential downside of 1.86%. Given Twenty-First Century Fox Inc Class A’s stronger consensus rating and higher possible upside, analysts clearly believe Twenty-First Century Fox Inc Class A is more favorable than Discovery Inc Series C.

Risk and Volatility

Twenty-First Century Fox Inc Class A has a beta of 1.32, meaning that its share price is 32% more volatile than the S&P 500. Comparatively, Discovery Inc Series C has a beta of 1.41, meaning that its share price is 41% more volatile than the S&P 500.

Summary

Twenty-First Century Fox Inc Class A beats Discovery Inc Series C on 13 of the 17 factors compared between the two stocks.

About Twenty-First Century Fox Inc Class A

Twenty-First Century Fox, Inc. operates as a diversified media and entertainment company primarily in the United States and Canada, Europe, and internationally. It operates through Cable Network Programming, Television, and Filmed Entertainment segments. The company produces and licenses news, business news, sports, general entertainment, factual entertainment, and movie programming for distribution primarily through cable television systems, direct broadcast satellite operators, telecommunication companies, and online video distributors. It also broadcasts network programming; and operates 28 broadcast television stations, including 11 duopolies in the United States. In addition, the company produces and acquires live-action and animated motion pictures for distribution and licensing in various formats in entertainment media, as well as produces and licenses television programming. The company was formerly known as News Corporation. Twenty-First Century Fox, Inc. was founded in 1922 and is headquartered in New York, New York.

About Discovery Inc Series C

Discovery, Inc. operates as a media company worldwide. The company operates through U.S. Networks, International Networks, and Education and Other segments. It owns and operates various television networks under the Discovery Channel, TLC, Animal Planet, Investigation Discovery, Science Channel, Velocity, Discovery Family Channel, Destination America, American Heroes Channel, Discovery Life, The Oprah Winfrey Network, Eurosport, Discovery Kids, DMAX, and Discovery Home & Health brands, as well as other regional television networks. The company's content spans genres, including survival, exploration, sports, lifestyle, general entertainment, heroes, adventure, crime and investigation, health, and kids. It also develops and sells curriculum-based education products and services, such as an online suite of curriculum-based video on demand (VOD) tools, professional development services, and digital textbooks, as well as student assessments; and publishes hard copy curriculum-based content for K-12 schools. In addition, the company operates production studios that develop content; and Websites. It provides content through various distribution platforms comprising pay-television, free-to-air and broadcast television, Websites, digital distribution arrangements, and content licensing agreements, as well as various platforms that include brand-aligned Websites, online streaming, mobile devices, VOD, and broadband channels. As of December 31, 2017, the company operated approximately 400 distribution feeds in 40 languages internationally. Discovery, Inc. was founded in 1985 and is headquartered in Silver Spring, Maryland.

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