Wednesday 26 April 2017

News Corp may boost its quarterly dividend

Ronald Grover and Michael White

News Corp, trying to rebuild investor confidence after a phone-hacking scandal, may raise its quarterly dividend by 20pc when the company reports earnings today, according to data compiled by Bloomberg.

The payout probably will rise to 9 cents a share from 7.5 cents, according to projections. News Corp may instead hasten share purchases under a $5bn buyback, said Brett Harriss, an analyst at Gabelli & Co, which owns voting and non-voting stock of the New York-based company. News Corp's board have met and earnings are set for today after markets close.

The dividend and buyback may mollify stock investors stung by a 25pc drop since July 4, when a story by the 'Guardian' newspaper led to revelations of widespread phone-hacking by the company's 'News of the World' tabloid. Chairman Rupert Murdoch (80) will be on an investor conference call after the profit report.

"I think most investors want to see an aggressive repurchase," said Harriss, who has a 'hold' rating on the stock. "They would highlight that there's a $5bn authorisation and say they intend to repurchase aggressively."

The board meeting at the Twentieth Century Fox studio in Los Angeles marks the first formal gathering of the company's 16 directors since the UK phone-hacking scandal broke.

The public relations firm Sard Verbinnen, hired to help News Corp respond to the crisis, has surveyed the largest shareholders to gauge investor opinion ahead of the earnings conference call.

News Corp fell $1.05, or 7.2pc, to $13.62 on Monday in Nasdaq Stock Market trading on a day when the S&P 500 index declined 6.7pc. (Bloomberg)

Irish Independent

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