FWONA

We rate Liberty Media Corp (FWONA) as Avoid with a composite score of 26.1/100 at a current price of $79.34. The stock falls in the bottom quintile of our universe across key quantitative factors, and the multi-factor weakness suggests a high probability of continued underperformance.

The rating is primarily driven by strength in stability (71th percentile) and investment (22th percentile), which together account for the majority of the composite score. Offsetting weakness in quality (9th percentile) and value (10th percentile) tempers our overall conviction. We assign a No Moat rating (28/100), Medium uncertainty, and Poor capital allocation.

Key items to watch: momentum to confirm whether the current price trend has legs; valuation compression risk if growth disappoints. Any material change in these dynamics could warrant a reassessment of our rating. The moat trend is stable, which suggests the competitive landscape is stable for now.

Liberty Media Corp holds a top-quartile position (#0 of 50) within the Transportation, Communications, Electric, Gas, And Sanitary Services sector, based on our composite quantitative scoring across quality, value, momentum, and stability factors. The composite score of 26.1/100 places it at rank #4737 in our full 7,333-stock universe. With a $32.6B market capitalization, Liberty Media Corp operates at meaningful scale within the Transportation, Communications, Electric, Gas, And Sanitary Services sector, providing competitive advantages in distribution, procurement, and customer reach.

Revenue contraction of -100% combined with momentum at the 19th percentile paints a cautious picture of the near-term business outlook. The market appears to be pricing in continued challenges, and a catalyst for reversal is not clearly visible from current data.

The margin cascade tells an important story: gross margins of 35% (-19.8pp vs sector) narrow to operating margins of 20% (+2.8pp vs sector) and net margins of 15.2%, yielding a gross-to-net conversion rate of 43%. This efficient conversion suggests well-controlled operating costs and limited margin leakage between the gross and net levels.

At a current price of $79.34, Liberty Media Corp is trading at a premium to fundamental value. Our value factor score of 10/100 reflects a composite assessment across multiple valuation metrics including price-to-earnings, price-to-book, EV/EBITDA, and price-to-sales ratios relative to both sector peers and the broader market. The premium valuation implies the market is pricing in significant future growth or quality improvements that are not yet fully reflected in current fundamentals.

The stock currently trades at P/B of 2.8x, P/S of 9.1x. We evaluate these multiples in the context of both absolute levels and sector-relative positioning to form our valuation view.

We assign a Medium uncertainty rating to Liberty Media Corp. The stock presents a balanced risk profile: weak quality scores (9th percentile) and low beta of 0.64 — while defensive, this may indicate limited upside participation in bull markets. While not risk-free, the core business fundamentals are adequate to withstand moderate economic stress, and the range of potential outcomes around our fair value estimate is manageable.

Specific risk factors that inform our assessment include: weak quality scores (9th percentile); low beta of 0.64 — while defensive, this may indicate limited upside participation in bull markets. Each of these factors independently widens the distribution of potential outcomes, and in combination they create a risk profile that demands careful position sizing. The stability factor at the 71th percentile and quality factor at the 9th percentile provide a quantitative summary of the overall risk landscape.

Key risk mitigants include: above-average stability (71th percentile) suggests predictable business dynamics. These factors partially offset the identified risks and provide downside protection in adverse scenarios. On balance, the risk-reward profile is favorable for long-term investors.

We rate Liberty Media Corp's capital allocation as Poor. Key concerns include low returns on equity (-63.6%), weak asset returns (ROA -26.3%). Exemplary capital allocators generate ROE above 20% and maintain conservative leverage — Liberty Media Corp significantly underperforms these benchmarks, raising questions about management's ability to create shareholder value.

Investors should scrutinize management's reinvestment decisions and balance sheet trajectory before committing capital. Poor capital allocation often compounds over time: overlevered balance sheets limit strategic flexibility, while low returns on capital destroy shareholder value. We would need to see sustained improvement in profitability metrics and balance sheet discipline before considering an upgrade.

In summary, Liberty Media Corp receives a Avoid rating with a composite score of 26.1/100 (rank #4737 of 7,333). Our quantitative framework assigns a No Moat (28/100, trend: stable), Medium uncertainty, and Poor capital allocation. The average factor score across quality, value, momentum, stability, and investment is 26/100.

Our analysis does not support a constructive view on Liberty Media Corp at this time. The combination of limited competitive advantages, medium uncertainty, and poor capital allocation suggests unfavorable risk-reward at current levels. We recommend investors avoid new positions and existing holders consider reducing exposure.