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Liberty Media Corporation, the parent company of several media, communications, and entertainment businesses, said Thursday that it has been notified of an antitrust investigation by the U.S. Department of Justice (DOJ) concerning Formula 1.
The investigation is examining Formula 1's actions in relation to the application by Andretti Formula Racing to join the FIA Formula One World Championship.
The company disclosed the DOJ's inquiry in a regulatory filing with the Securities and Exchange Commission (SEC) on Thursday. According to the filing, Liberty Media, which is registered in Delaware and headquartered in Englewood, Colorado, intends to fully cooperate with the investigation and any associated requests for information.
Liberty Media, which operates under various stock symbols including LSXMA, LSXMB, and LSXMK for its Liberty SiriusXM Group, as well as FWONA and FWONK for its Liberty Formula One Group, and LLYVA and LLYVK for its Liberty Live Group, said it is committed to transparency and compliance with all regulatory requirements.
Meanwhile, Liberty's subsidiary, SiriusXM, a major player in the audio entertainment industry, reported a quarterly cash dividend of $0.0266 per share, a move reflecting its consistent financial policies and commitment to delivering shareholder value.
Concurrently, SiriusXM is involved in a significant merger with Liberty Sirius XM Holdings (NASDAQ:SIRI) Inc., a subsidiary of Liberty Media Corporation. The merger deal has recently undergone amendments, approved by both companies' Board of Directors, reducing the total number of outstanding shares of New Sirius common stock by 90% immediately after the transactions close.
InvestingPro Insights
Amidst the scrutiny of the antitrust investigation, Liberty Media Corporation's financial health remains a key factor for investors. According to InvestingPro data, Liberty Media (LSXMA) boasts a robust market capitalization of $6.87 billion and a P/E ratio that has adjusted to 7.82 in the last twelve months as of Q1 2024, signaling a potentially undervalued stock. The company has also demonstrated a solid gross profit margin of 48.94%, reinforcing its profitability in the recent fiscal period.
InvestingPro Tips suggest that Liberty Media's valuation indicates a strong free cash flow yield, which could be appealing for value investors. However, it is important to note that the company's short-term obligations currently exceed its liquid assets, which may raise concerns about its immediate financial flexibility. Furthermore, with the stock trading near its 52-week low, some investors might view this as an opportune entry point, especially considering analysts' predictions that the company will be profitable this year. It's also worth mentioning that Liberty Media does not pay a dividend, which could influence the investment strategy for income-focused shareholders.
For a deeper dive into Liberty Media's financial metrics and additional InvestingPro Tips, investors can explore the comprehensive analysis available at InvestingPro, which includes 5 more tips to guide investment decisions.
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