News Corp offers best value of media stocks

Sydney: News Corp offers the best value among Australian media stocks poised to benefit from a rebound in advertising revenue, according to Royal Bank of Scotland Group Plc.

Shares in media companies such as Fairfax Media Ltd and West Australian Newspapers Holdings Ltd look cheap considering newspaper advertising is in the early stages of a recovery, RBS analysts led by Fraser McLeish wrote in a research note.

News Corp, the owner of Fox News, last month reported a rebound in quarterly profit from a year-earlier loss. Fairfax last week posted full-year earnings that beat analyst estimates as second-half advertising revenue rose at all its Australian media units, while West Australian Newspapers' full-year profit rose 10 per cent.

"Reporting season confirmed that the rate of ad growth accelerated over the June half," the RBS analysts said in their report.