Buying More WBD Stock Despite Disappointing Earnings and an Uncertain Future

Buying More WBD Stock Despite Disappointing Earnings and an Uncertain Future | WBD Stock Analysis

Рет қаралды 1,413

5 ай бұрын

A review of WBD's earnings call, its struggles with DTC and a shrinking networks business.
Links discussed in this video :
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s201.q4cdn.com/336605034/file...
Hit file make a copy to use this spreadsheet
docs.google.com/spreadsheets/...
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Disclosure : I am long WBD and may be long stocks discussed in this video in the near future. I am not a financial advisor and do stock analysis as a hobby. Opinions are my own. This is not financial advice. Consult with a financial advisor before making any investments as stock investing comes with risk of loss. The spreadsheet may have errors and should only be utilized for entertainment purposes.

Пікірлер: 22

@gerritjanboeve 4 ай бұрын

Good analysis. I'd say wbd is a solid buy right now. Max is likely to be in the top 3 global streaming services mid/long term. If Netflix's valuation is anything to go by, WBD is an incredible bargain. I also think that there are multiple companies interested in wbd at these prices. If amazon were to take over wbd for example, they will instantly have all the content they need for prime.

@geno3382 5 ай бұрын

thank you

@redequal7457 5 ай бұрын

Great analysis. And based on it, I feel I will never get back the money I lost, 180K, from the shares given me by AT&T, after it cut my dividend in half. My shares are down from 24 to 8 and change. I feel I will be lucky to get back 15 per share after 3 more years. The shares will never get back into the twenties. WBD's business model is a failure and is dying, as you seem to present in this video.

@TimeintheMarket 5 ай бұрын

It certainly looks bleak but at this price point, it's an interesting investment which is why I've been buying some. I think the turnaround possibility is there but it'll take a while for that thesis to play out and if they can't resume growth in the next year or two, it'll be a tough thesis to stick with. The AT&T deal just saddled them with so much debt at a time where the industry was changing quickly and that really limited their ability to respond well.

@Tristen501 4 ай бұрын

Bro! Loved your analysis! Sub'd

@OldAssSax 5 ай бұрын

I think it is cheap even figuring 10-12% ad decline in linear, little growth in Max and debt level. I was a heavy buyer today but I am worried about them potentially trying to buy paramount and the sports JV eating some cash upfront and overspending on sports content. However, my guess is that they will still generate at least $4 billion in FCF in '24 and that makes the stock cheap on a FCF yield basis (4-5 times) even with the heavy, but manageable net debt load--$40B @ and avg. 4.6%.

@aightm8 5 ай бұрын

Looks like they stepped away from the para acquisition which is great

@stephenlevy1011 3 ай бұрын

I think WBD just needs to hold out a little longer before they get a lot of wind behind them. Short term ai will massively disrupt entertainment and will drastically lower costs. Long term tech is gonna open up really big new ways to experience entertainment, specifically in gaming and virtual reality experiences. At that stage it’s all about who has the most valuable IP, especially IP that has appeal in gaming and virtual reality, and other than Disney, Warner has everyone completely out matched. I think Disney is better positioned and able to execute on that, but I think both are well positioned to succeed and Warner is at a serious discount.

@TimeintheMarket 3 ай бұрын

I think AI is going to be interesting. On one hand it could make things a lot cheaper for companies like WBD. On the other hand, if it's good enough, it could create a lot of competition as now any creative with a nice computer could be out there making quality films(but even so they'd probably need to work with a distributor like WBD to get them out there). It'll be interesting to see how it plays out but the AI quality is just getting better and better each year.

@joshuaburns3167 5 ай бұрын

It's dipping below 7.50 or 7 before finding its bottom.. I'll have to see how it reacts at 7.50 to know. I think they either get bought out or the upcoming movies after Dune will help.

@mattanonysaurousrex 5 ай бұрын

The future of content is streaming services, and Netflix is the best in class. I'd rather own DIS, if I had to pick a secondary, because more of their intellectual property crosses generations, even if they haven't done a good job selling it the last few years. I think generative AI is going to massively disrupt this industry in the next few years. This will massively decrease the cost of making content. I don't know enough about the industry to pick in who could be the winner.

@TimeintheMarket 5 ай бұрын

I agree, that's my main concern with WBD, with the focus being on FCF generation and paying down debt, will their streaming platforms suffer and fall behind in growth. They're already showing mediocre growth but they still do have a lot of markets to expand into which will at least juice international numbers. As far as streaming power goes, I think Netflix is king then Disney(with Hulu, not a huge fan of D+) and then maybe WBD and Amazon. Although I think Apple TV+ has been the best when it comes to quality content even though they probably don't have the sub #s of the other ones. Para+ and Peacock are out there too but I see those as something someone else will eventually swallow.

@hidingindanielsroom7268 5 ай бұрын

@@TimeintheMarket I think Apple should not focus on streaming/TV and should get out of this industry ASAP. They should go back to making good phones, make vision pro slimmer like a sunglass and make a foldable phone what really rocks the market.

@aightm8 5 ай бұрын

There doesn't need to be a single winner. Im happy to own the third best if it can be purchased at a steep discount, which I think WBD is

@joeycruz7720 3 ай бұрын

@@aightm8 WBB 20 billion Market Cap Disney and Netflix 200+ billion market cap. When it comes to streaming I think you're average household will have three and I think it will be Netflix and Max for adults and Disney+ for the kids. As a 37 year old male I prefer the IP Max has to all the others. I think as it reduces its debt, as its coming out of incredible headwinds I think WBD could be at a 200billion market cap in 3-6 years.

@aightm8 3 ай бұрын

@@joeycruz7720 in this particular scenario id look at enterprise value to free cash flow for the companies. WBD still insanely cheap. When they pay most of the debt and start buybacks I think the returns will be great. Been a bagholder for 2 years though we will see.

@waysofzen 5 ай бұрын

Warner Bros is a great asset and business... problem is ATT saddled WB with their mountain of debt when they merged with another dying brand, Discovery. ATT had to pay down their debt they accumulated with dumb acquisitions over the years. Until WBD can clear this debt, there is no future for this company other than selling off assets to make those interest payments. This is a desperate company right now.

@TimeintheMarket 5 ай бұрын

Agree, AT&T certainly screwed them and this will take a while to play out.

@joeycruz7720 3 ай бұрын

They have already paid off all there variable debt. They have like 20 years to pay the 42 billion at a fixed rate. They paid off 12 billion in like a year and a half. This is coming off a time where a huge source of revenue was destroyed by Covid. Now that the box office seems to be turning around the debt may be paid off faster then some think.