LIBERTY MEDIA CORPORATION (FWONA): what the price requires
At today's price, LIBERTY MEDIA CORPORATION (FWONA) is priced for today's economics sustained for ~9.9 years. boothcheck doesn't publish a fair value or a price target; it shows what the price assumes, so you can judge whether that bar is too high.
Generated: 2026-07-19 · Source: https://boothcheck.com/report/FWONA
Headline
| Field | Value |
|---|---|
| Ticker | FWONA |
| Company | LIBERTY MEDIA CORPORATION |
| Current price | $92.26/sh |
| Composition | Formula One 92% / MotoGP 8% |
What The Price Requires (Inversion)
The assumption today's price embeds, recovered by inverting the valuation.
| Field | Value |
|---|---|
| Inversion basis | whole-company |
| Operating margin needed | 13.6% |
| Operating margin today | 14.9% |
| Margin compression implied | -1.3pp |
| Must persist for | 9.9y |
| Multiple paid | 49x operating income |
The operating-margin requirement is derived from the framework's value band at year 12, a separately labeled basis from the headline growth/duration solve.
Solve inputs: computed at a 9.4% cost of capital; growth searched up to the 25% self-funding ceiling; each 1pp moves the implied horizon ~2.1 years.
How unusual the bet is: high
| Reference | Value |
|---|---|
| vs own history | +0.04σ |
| cohort percentile (of 33 peers) | 88 |
| sustained it ~9.9 years at this level | 14% |
| implied end-window share | 0% |
Valuation X-Ray
Asset, earnings-power and peer-multiple models all land far below the price; ONLY the growth-DCF reaches it. The bet is durable compounding the static frames structurally cannot price (a moat/durability premium).
How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.
| Family | Median price/FV | Models | Reads |
|---|---|---|---|
| Asset | — | 0 | — |
| Earnings | 2.51x | 1 | expensive |
| Relative | 4.41x | 3 | expensive |
| Growth | 1.02x | 1 | expensive |
Families that justify the price: Growth Families that call it expensive: Earnings, Relative
The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 8.1%); the inversion above states its own rate.
Per-Model Detail (n=5)
| Model | Family | FV | Price/FV | Applicable | Methodology |
|---|---|---|---|---|---|
| DCF Perpetual Growth | Growth | $0.00 | — | no | Negative/zero FCF — equity value floored at $0 |
| DCF Exit Multiple | Growth | $0.00 | — | no | Negative/zero FCF or EBITDA — equity value floored at $0 |
| Relative Valuation | Relative | $20.94 | 4.41x | yes | P/S fallback (negative EPS): Sector P/S 1.5x × TTM revenue — excluded from consensus |
| Simple DDM | Growth | — | — | no | — |
| Two-Stage DDM | Growth | — | — | no | — |
| Simple Excess Return | Asset | $0.10 | 922.60x | yes | BV/sh $22.74, ROE (TTM) 0.0%, ke 9.3% (excluded from median) |
| Two-Stage Excess Return | Asset | $0.05 | 1845.20x | yes | 5yr excess ROE then converge to ke=9.3% (excluded from median) |
| Discounted Future Market Cap | Growth | $90.13 | 1.02x | yes | Rev $4.7B, growth 15% (input: historical growth; tapered), Terminal P/S: 5.4x / 6.6x / 7.8x (bear / base = today's held flat / bull, cap 12x) |
| Peter Lynch Fair Value | Relative | $0.00 | — | no | Negative/zero EPS — earnings-based value floored at $0 |
| Margin Trajectory | Growth | — | — | no | — |
| Earnings Power Value | Earnings | $36.83 | 2.51x | yes | Normalized EBIT (5y avg op income, one-time charges added back) $1.45B × (1−9%) / WACC 8.1% → EPV (no growth) |
| Residual Income | Asset | $0.03 | 3075.33x | yes | BV $22.74 + 5yr PV of (ROE (TTM) 0.0% − Kₑ 9.3%) × BV; BV grows 0.0%/yr (excluded from median) |
| Graham Number | Asset | — | — | no | — |
| EV/EBITDA Relative | Relative | $15.35 | 6.01x | yes | EBITDA $1.12B × sector EV/EBITDA 8.0x |
| FCF Yield | Earnings | — | — | no | — |
| SBC-Adj FCF Yield | Earnings | — | — | no | — |
| Ben Graham Formula | Earnings | — | — | no | — |
| ROIC-Justified P/B | Asset | $1.43 | 64.52x | yes | BV $22.74 × (ROIC 0.5% / WACC 8.1%) (excluded from median) |
| P/Sales Sector | Relative | $20.94 | 4.41x | yes | Revenue $4.75B × sector P/S 1.5x |
| PEG Fair Value | Relative | — | — | no | — |
| Earnings Yield | Earnings | — | — | no | — |
| Funds From Operations Multiple | Relative | — | — | no | — |
| Clinical Phase NPV | Growth | — | — | no | — |
| Merton | Asset | — | — | no | — |
| V5 Mechanical | — | — | — | no | — |
Solvency
| Field | Value |
|---|---|
| Net debt | $3.7b |
| Net debt / NOPAT (after-tax) | 5.78x |
| Net debt / operating income (pre-tax) | 5.29x |
| Interest coverage | 2.7x |
| Burning cash | no |
Bullet Takeaways
- Reported earnings are depressed by acquisition amortization, which makes the static models look alarming; the underlying F1 franchise grew revenue 14% to $3.9 billion in 2025 and 53% in Q1 2026 (flattered by an extra race), with adjusted OIBDA up 20% and 102% respectively.
- At $84 the price is a durability premium: only growth-DCF and revenue-multiple frames reach it, while earnings-power value lands near $10 and asset frames near $1 to $2, so the bet is that contracted escalation persists.
- The swing factors are the next US media-rights renewal cycle and continued sponsorship and race-promotion growth, against net debt near $3.7 billion (more than 5x operating income, coverage near 2.6x).
Bull Case
The loudest objection to owning this stock is that it looks unprofitable on a trailing basis, with thin reported earnings and a deeply negative read from the static valuation models. Take that fear seriously, then look at what actually drives it. Liberty Media's Formula One business carries a large amortization load from the original acquisition of the sport, and that non-cash charge depresses reported earnings while the franchise itself is compounding fast. The accounting understates the economics. Once you look past it, the underlying business is one of the cleanest growth assets in media.
The growth is real and accelerating. In Q1 2026 F1 revenue rose 53% to $617 million, with adjusted OIBDA up 102% to $172 million, helped by an extra race in the quarter and calendar timing but also by genuine underlying gains. For full-year 2025, F1 revenue grew 14% to $3.9 billion and adjusted OIBDA grew 20% to $946 million. The revenue rests on three contractual pillars the 10-K describes directly, race promotion, media rights, and sponsorship arrangements (FY2025 10-K, accession 0001104659-26-020653), all multi-year contracts that provide visibility most media businesses lack.
The moat is structural. Formula One is a global sports monopoly with no real substitute: a single sanctioning body, a fixed calendar of marquee events, and a fan base that has grown sharply in the United States since the Drive to Survive era. That scarcity is why sponsors keep signing, with new and extended deals announced with Salesforce, Allwyn, Marsh, FanDuel, and Betway, and why the calendar keeps expanding, including the Turkish Grand Prix returning in 2027. Add the smaller MotoGP asset, and Liberty owns two-wheel and four-wheel global motorsport. The bet is that durable, contracted compounding the static models cannot price is worth a premium, and the recent results support it.
Bear Case
The price is a bet on a specific future, and the most fragile assumption baked into it is that F1's recent growth rate is the new baseline rather than a peak. The Q1 2026 print that showed F1 revenue up 53% was flattered by an extra race in the quarter and calendar timing on revenue and cost recognition, which the company itself disclosed. Strip those one-offs and the durable underlying growth is closer to the mid-teens pace of 2025. At $84 the stock is priced for the headline number to persist, and the valuation models make the gap stark: only the growth-DCF and revenue-multiple frames reach the price, while earnings-power value lands near $10 and the asset-based models land near $1 to $2 on a thin returns base.
The second fragile assumption is that the contracted revenue streams keep escalating. Media rights, the largest pillar, depend on broadcasters continuing to pay up for live sports in a fragmenting streaming market, and the next major US media-rights cycle is the single biggest swing factor in the model. If that renewal comes in flat rather than sharply higher, a large part of the growth thesis weakens at once. Race-promotion fees depend on host governments and circuits continuing to bid for races; sponsorship depends on corporate marketing budgets that compress in a downturn. Each pillar is contracted, but contracts expire and reset.
The balance sheet adds leverage to the bet. Net debt sits near $3.7 billion against trailing operating income of about $708 million, more than 5x, with interest coverage near 2.6x. That is manageable while OIBDA grows, but it leaves less cushion if a media-rights renewal disappoints or a recession trims sponsorship and attendance. The structural truth is that the multiple is pricing what has not happened yet: the next leg of contracted escalation, not the cash the business produces today.
Valuation
Inverting the $84.07 price puts the embedded bet on a long persistence of premium economics, around 9.3 years of duration on the model's lever, against a current operating margin near 14.9% and an implied margin near 12.6%. The engine characterizes the price as elevated: asset, earnings-power, and peer-multiple models all say richly valued, and only the growth-DCF and revenue-multiple frames reach it. That is the signature of a moat-and-durability premium rather than a claim on present earnings.
The model X-ray is lopsided because trailing reported earnings are suppressed by amortization. Earnings-power value lands near $10 capitalizing normalized EBIT, and the excess-return and residual-income models collapse to $1 to $2 because trailing ROE is under 1% on a $22.74 book value. Against those, the discounted-future-market-cap method lands near $122 on roughly 30% tapering revenue growth, and the relative and P/S-sector methods land near $21 on a generic media multiple that does not capture F1's scarcity.
The spread is the information. The static frames are structurally unable to price a contracted global-sports monopoly whose reported earnings are depressed by non-cash charges, so they land far below the price; the forward frames that capitalize the growth land far above. The peer set, RSI, DKNG, ROKU, LTH, and FUN, is leisure and digital media rather than a clean comparable, which is why peer multiples understate the asset. The investable question is not whether F1 is a good business, it clearly is, but whether $84 already pays for the next several years of contracted escalation, with the upcoming media-rights cycle as the variable that decides it.
Catalysts
Liberty Media reported Q1 2026 on May 7, with F1 revenue up 53% to $617 million, operating income of $107 million, and adjusted OIBDA up 102% to $172 million, helped by one extra race in the quarter and calendar timing. Consolidated revenue rose to $711 million from $447 million, and net earnings attributable to Liberty stockholders rose to $57 million from $5 million. The earnings surprise was large at roughly +148%, with revenue ahead by about 7%.
The forward catalysts are the calendar and the contracts. Liberty announced the Turkish Grand Prix returning in 2027 under a new multi-year deal, extended partnerships with Salesforce and Allwyn, and signed new multi-year sponsorships with Marsh, FanDuel, and Betway, each a small, visible escalation in the sponsorship pillar. The larger swing factor over the next year is the US media-rights cycle, where the size of the next renewal is the most important single input to the growth thesis. Continued expansion of the race calendar and per-race economics are the other levers, while the durability of the post-pandemic surge in US fandom is the assumption the whole case rests on.
Sources: Liberty Media Q1 2026 results (libertymedia.com, StockTitan, Yahoo Finance, May 2026); FY2025 10-K (accession 0001104659-26-020653).
Peer Cohorts (Per Segment, With Filing Citations)
Formula One / MotoGP (reported)
- TKO (TKO GROUP HOLDINGS, INC.)
- FY2025 10-K: …and the lenders party thereto. S-1 333-254908 10.14 03/31/2021 10.18 Fourth Amendment dated April 29, 2019, among Zuffa Guarantor, LLC, UFC Holdings, LLC, Goldman Sachs Bank USA, as administrative agent, and the lenders party thereto. S-1 333-254908 10.15 03/31/2021 10.19 Fifth Amendment dated September 18, 2019,…
- FY2025 10-K: …to intervene in support of Lega Nazionale's claim or alternatively to individually claim damages deriving from the lower value of the media rights in the amount of EUR 284.9 million, in the case of five clubs, and unspecified amounts (to be quantified as a percentage of the total amount sought by Lega Nazionale) in…
- CHDN (Churchill Downs Inc)
- FY2025 10-K: …chdn:LiveAndHistoricalRacingMember 2025-01-01 2025-12-31 0000020212 us-gaap:OperatingSegmentsMember chdn:GamingMember chdn:ExternalCustomerMember chdn:WageringServicesAndSolutionsMember 2025-01-01 2025-12-31 0000020212 us-gaap:OperatingSegmentsMember chdn:GamingMember chdn:ExternalCustomerMember…
- FY2025 10-K: …chdn:GamingSegmentMember 2024-01-01 2024-12-31 0000020212 us-gaap:OperatingSegmentsMember chdn:PariMutuelHistoricalRacingMember chdn:ExternalCustomerMember 2024-01-01 2024-12-31 0000020212 us-gaap:CorporateNonSegmentMember chdn:PariMutuelHistoricalRacingMember chdn:ExternalCustomerMember 2024-01-01 2024-12-31…
- LYV (LIVE NATION ENTERTAINMENT, INC.)
- FY2025 10-K: …Amended and Restated Ticketmaster Entertainment, Inc. 2008 Stock and Annual Incentive Plan. 10-Q 001-32601 10.1 11/4/2010 10.7 § Form Stock Option Agreement for the Live Nation Entertainment, Inc. 2005 Stock Incentive Plan, as amended and restated as of March 21, 2024. 10-Q 001-32601 10.2 6/14/2024 10.8 § Form…
- FY2025 10-K: 2024 from $1.2 billion to $1.3 billion. Sponsorship & Advertising AOI increased by $81.4 million, or 11%, compared to 2024, from $763.8 million to $845.2 million. The increase was largely driven by the United States, Latin America and Europe. Naming rights and other innovative deals attached to our new venues drove…
- MSGS (MADISON SQUARE GARDEN SPORTS CORP.)
- FY2025 10-K: …operating lease costs of (i) $44,052 and $42,769 of expense paid in cash for the years ended June 30, 2025 and 2024, respectively, and (ii) a non-cash expense of $23,566 and $24,850 for the years ended June 30, 2025 and 2024, respectively. Player Salaries, Escrow System/Revenue Sharing and NBA Luxury Tax The amount…
- FY2025 10-K: …is distributed in equal shares to non-taxpaying teams. The Company recognizes the estimated amount associated with luxury tax expense or the amount it expects to receive as a non-tax paying team, if applicable, on a straight-line basis over the NBA regular season as a component of direct operating expenses. NBA and…
- MSGE (MADISON SQUARE GARDEN ENTERTAINMENT CORP.)
- FY2025 10-K: …and modifying certain key Tax Cuts & Jobs Act provisions (both domestic and international), expanding certain Inflation Reduction Act incentives, and accelerating the phase-out of others. The Company is currently evaluating the impact of these provisions on the Company's consolidated financial statements. Note 16.…
- FY2025 10-K: …Statement on Form S-1 filed on June 20, 2023). 10.31 Flight Crew Services Agreement, dated May 6, 2019, between DFO and MSG Entertainment Group, LLC (formerly MSG Sports & Entertainment, LLC) (for the Challenger) (incorporated by reference to Exhibit 10.31 to the Company's Registration Statement on Form 10 filed on…
Methodology Note
- Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
- Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
- Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
- Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.
Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.