Now that we're clear on what management wants us to know about the business, let's explore the factors that could drive Twenty-First Century Fox, Inc. (NASDAQ:FOXA) stock higher.

No more distractions

Two weeks ago, we were talking about a very different company. Back then, Fox stock was falling in response to an unsolicited $85-a-share offer for Time Warner (NYSE:TWX.DL). Investors seemed convinced that Fox was overpaying for a business that's still seeking its next big franchise. Chief Operating Officer Chase Carey addressed that concern on Fox's most recent earnings conference call:

First, let me be clear, we are done. We pursued this potential combination to achieve one overarching goal, to create value for our shareholders. It became increasingly clear that the combination of the drop in our share price and the highly defensive nature of Time Warner's actions was going to lead to a transaction where too much of the value created in success went to Time Warner's shareholders.

Three reasons Fox stock could rise

With the Time Warner deal no longer a factor, what other catalysts can investors expect during the next 12 to 24 months? Here are three that stand out:

1. The X-Universe is expanding again
May's X-Men: Days of Future Past marks the mutant franchise's second consecutive winner after a troubling trilogy that ended with 2006's poorly received X-Men: The Last Stand. Last year's The Wolverine earned $414.8 million worldwide on a $120 million production budget, easily surpassing X-Men: First Class. Adding in another $75.5 million from home video sales makes The Wolverine one of the more profitable movies in Fox's X-franchise  (source:

Hugh Jackman has been a consistent presence throughout the growing X-Men movie franchise. Credit: Twenty-First Century Fox.

Days of Future Past did better on a gross basis, setting a new franchise record with $744 million in worldwide grosses. But the film's impact goes much further than the box office. Shortly after Days of Future Past started its long, successful run at theaters, Fox announced plans to release the next installment, titled X-Men: Apocalypse, in May 2016. Spinoffs also appear to be in the works.

2. Fox Sports will put cash in the coffers
Earlier this month, Fox celebrated the one-year anniversary of Fox Sports 1 and Fox Sports 2, the newest additions to its cable sports lineup. Business appears to be going well. In a press release, the company said Fox Sports 1 was the fastest-growing sports cable channel in prime time, with key demographics -- including the all important 18-49 demo -- up 62% year over year.

We could see more growth down the road. During the most recent earnings call, Chief Financial Officer John Nallen reminded investors that Fox would be sacrificing some short-term profit to invest in cable sports and entertainment programming here and abroad. How big might the bet pay off? Variety asked a number of analysts that very question. Their estimates suggest that just Fox Sports 1, on its own, could pull in an extra $1 billion in revenue.

3. A cheap valuation
Perhaps that explains why Fox is willing to repurchase $6 billion of its shares in the months ahead. At the very least, it's fair to say that CEO Rupert Murdoch sees an opportunity. Here he is talking about the buyback on Fox's latest earnings call:

We believe buying our own stock, when it is underpriced, represents a unique opportunity to maximize shareholder value over the long term. And at these levels, we believe our stock is severely undervalued.

"Severely?" That might be pushing it, but I can also see Murdoch's point. Fox stock has sharply underperformed the market year to date despite improving fundamentals.

Revenue growth has accelerated in each of the past three fiscal years. Returns on capital have risen steadily during the same period. Profits haven't come as quickly, but that's also understandable given the company's ongoing investment in sports programming.

Foolish takeaway

Fox is in a time of transition. New X-movies are in development, as are other franchises, while Fox Sports 1 and Fox Sports 2 are potential catalysts. In buying back stock now, Murdoch may very well be amplifying returns for today's investors.