Will Tucker Carlson Leaving Fox News Affect Fox Stock?
Reactions to the dismissal of Fox News host Tucker Carlson were divided, largely dependant on political affiliation. While there will be many suitors vying for Carlson’s particular talents, the future of Fox’s stock value is less than certain.
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Fox Corporation stock lost about $962 million in market value on Monday, April 24, after the media company said it was parting ways with Carlson, according to Business Insider. Company class A shares sank as much as 5.4% on Monday before leveling off at 2.9%, paring the loss back to about $500 million. Fox stock then dropped 17 cents (0.6%) to $29.74 on Tuesday. The stock has declined 3.5% since the close of trading on Friday, per CBS News.
Although Carlson is losing an established prime time audience, being a sudden free agent will attract many of Fox’s conservative competitors. Stock for web host and online video platform Rumble Inc. and the Trump-linked Digital World Acquisition Corp. increased 6% and 2.9% respectively after the news of Carlson’s ousting, according to Bloomberg.
Carlson’s removal had an immediate effect on the network and may flatten its stock value in the foreseeable future. “Fox Cable News is now in rebuilding mode, and it will likely take time for the stock to recover,” said KeyBanc Capital Markets analyst Brandon Nispel, as quoted by Business Insider. “We wonder what Fox is going to tell advertisers and how it will fill the gap in terms of programming and viewership.”
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Ultimately, according to Joseph Bonner, senior securities analyst at Argus Research, it may not matter much if you think Fox’s viewing numbers have more to do with an ideology than any individual. Whether it opts to replace Carlson with a similar conservative or not, Fox will find a replacement that won’t alienate followers.
Although he admits that there should be “some financial impact depending on who takes Carlson’s place and their success, or lack thereof,” Bonner told CBS MoneyWatch, “While commentators may talk about the sky falling at the loss of a major star, Fox has done quite well at producing new stars over time. We need to think about how much is it about the person and how much is it the platform.”
As undeniably popular as Tucker Carlson is (the audience for Carlson Tonight peaked over 3.7 million at times), his viewership never reached the lofty heights of his predecessor Bill O’Reilly, according to The Hollywood Reporter. O’Reilly, for example, averaged 728,000 viewers in 2017’s first quarter compared to Carlson’s 443,000 average in the first quarter of this year.
Carlson’s departure comes a week after Fox reached a $787.5 million defamation settlement with Dominion Voting Systems, which sued the company over the network’s coverage of the 2020 presidential election.
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