News Corporation’s demerger may result in only one of Rupert Murdoch’s companies making it into the coveted S&P/ASX50 Index - the index of the biggest stocks traded on the ASX, according to Morgan Stanley.
Morgan Stanley analyst, Antony Conte values Fox at $8.77 billion making it a member of the S&P/ASX50 Index and other indices. He ascribes a market value to News Corp of between $1.19 billion and $1.26 billion.
That would rank News Corp 95th on the S&P/ASX100 Index, based on Conte’s higher valuation.
“S&P will likely decide to omit News Corp from the S&P/ASX 100 index,” Conte says.
“Exclusion from S&P/ASX 100 index would provide opportunities for small cap managers to include it in their universe.”
The bigger the market value of a company the more fund managers generally include them in their portfolios as index weightings are skewed toward the largest companies in the indexes.
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