We will not overspend to drive subscriber growth. Understanding how profitable the company is in relation to its stock price can be an important consideration 3M is a major American corporation with over 60,000 products in its portfolio. However, most of the analysts rate the stock as a hold or some equivalent. Discovery has faced more cautious advertisers, ongoing cord-cutting, competition within streaming and upheaval created from the merger deal itself. One is a relatively high rate of churn. The Motley Fool owns shares of and recommends Netflix. Boutique investment research shop providing professional coverage on disruptive thematic equities. At the end of 2021, the pro forma debt for WBD was over $56 billion. Copyright 2023 Market Realist. net asset value under U.S. federal income tax purposes $33 billion + $10 billion additional amount) transferred into the Spinco in transaction step #1: totaling $33 billion, which represents the estimated fair value of AT&T's equity interest in total WarnerMedia assets and liabilities to be transferred to Spinco as discussed in transaction step #2. Copyright 2023 MarketWatch, Inc. All rights reserved. The resultant company, Warner Bros. We will be a simpler, more focused company with the intent to become Americas best broadband provider.. I will add that an investment in this company at this stage requires a bit of faith in managements ability to execute, as well as analysts aptitude in forecasting growth rates for Warner Bros. Let the power of quality research drive your investment convictions. In 1989, Warner merged with Time Inc., publishers of Time and Life magazines, who were almost immediately forced to buy Warner Bros. after a hostile takeover attempt by Paramount (who, funny enough, wanted Time, not Warner). His clients may own shares of the companies mentioned. Discovery posted fourth-quarter 2022 earnings on Feb. 23, with revenue of $11.01 billion decreasing Although I endeavor to provide accurate data, there is a possibility that I inadvertently relay inaccurate or outdated information. What Is the Standard Deduction for People Over 65 in 2023? Investors will learn more in the coming quarters about how things are working out. AT&T shareholders will own 71 percent of the merged firm, with Discovery shareholders owning the rest. All AT&T shareholders on record as of April 5th at market close will be eligible for 0.24 WBD shares for each share of AT&T share owned. The new company will be able to compete in the streaming industry. Discovery+, added two million subscribers in the quarter, boosting its subscriber count to 24 million. All Right Reserved. Billy Duberstein owns shares of AT&T, Discovery (C shares), and Netflix. Copyright 2023 ComicBook.com. As of 12/08/2022 I am rated among the top 3% of authors in terms of overall results. Please disable your ad-blocker and refresh. ) Discovery's Stock, 2 Growth Stocks That Can Turn $250,000 Into $1 Million by 2030, Billionaire Investor Bill Ackman Is Raking In $97 Million In Annual Dividend Income From These 2 Stocks, 1 Bargain-Basement Warren Buffett Stock Down 78% to Buy Before It Starts Soaring, 3 No-Brainer Stocks to Buy With $50 Right Now, Join Over Half a Million Premium Members And Get More In-Depth Stock Guidance and Research, Motley Fool Issues Rare All In Buy Alert, Copyright, Trademark and Patent Information. The combination of issued Spinco Debt Securities and cash proceeds from Spinco Financing Agreements provided to AT&T as part of transaction step #2 must total $43 billion, which represents the total consideration paid by Spinco to AT&T in exchange for its equity interests in the assets and liabilities of WarnerMedia (i.e. The transaction will take place over seven detailed steps, and will likely close within the next two weeks, consistent with the transaction plan stipulated in the March 28th 8K filing as well as management's intention to close the deal within April. Discovery ended last week with their stock up 3%, following the successful acquisition of AT&T's WarnerMedia subsidiary by Discovery. Could AT&T Stock Beat the Market in 2023? In other words, if an AT&T shareholder decides to sell an AT&T share under Ex-Distribution Trading between April 4th and the WBD transaction completion date, they will only be retaining rights to the WBD shares distributed to them as a result of their AT&T share ownership as of the record date (April 5th market close). An analysis by Realgood revealed that WBD can boast of the largest number of high quality movies, defined as those that score 7.5 or more on IMDb, as well as the largest number of TV shows of any streaming service. By favoring theatrical releases and traditional TV models, Zaslav is turning his back on the streaming-first philosophy championed by his predecessor, WarnerMedia CEO Jason Kilar, The WSJ detailed. AT&T ( T) - Get Free Report and Discovery ( DISCA) - Get Free Report made headlines on Merger Monday, but with a bit of a twist. Bill Peters is a Los Angeles-based MarketWatch reporter who covers earnings. The company previously expected $3 billion in annual run-rate synergies from the merger, but during the last earnings call, CFO Wiedenfels stated the $3 billion target might be conservative. With the 5G transition in full swing, the company can't afford to be distracted with the streaming media wars, paying down debt, and maintaining the dividend all at once. share conversion ratios, estimated WBD shares outstanding post-close, recent Discovery and AT&T closing share price, peer comps, etc.) Warner Bros. By comparison, the S&P 500 index Discovery, with Discovery shareholders holding the rest. David has covered a wide variety of financial and lifestyle topics for numerous publications and has experience copywriting for the retail industry. pertaining to the WarnerMedia spinoff, the telecom giant also submitted a, to the SEC, covering every "nitty-gritty" detail from pro-forma historical WarnerMedia statement of operations that were not previously available, all the way down to key terms of the merger agreement with. ) The Wall Street Journal this month reported that Warner Bros. Here are the key levels for The company the result of a merger last year between AT&Ts WarnerMedia and Discovery reported a fourth-quarter net loss of $2.08 billion, or 86 AT&T is also still behind competitors in 5G deployment, and is up against stiff competition in the fiber broadband space. Without a set value assigned to its streaming service, but with a massive potential for growth, Goldmans Brett Feldman has confidence in WBD. I wrote this article myself, and it expresses my own opinions. Trading AT&T and Discovery After $43 Billion Media Merger AT&T and Discovery have come to terms on a $43 billion media deal. Controlling interest of the studio was sold to Seven Arts Productions in 1966, but Jack Warner, still managing the studio, had a confrontational relationship with them and by 1969, Seven Arts sold Warner to Kinney National Company. Founded by four brothers in 1923, Warner Bros. is a giant in the film industry, but has changed hands more time than most fans can count. The Motley Fool has a disclosure policy. ET. I am a retired law enforcement officer. Now, the record date is not the same as the transaction completion date. An SEC filing last March, just prior to the merger, revealed that Discovery forecasts revenue from its U.S. linear TV business will decline by 4% per annum through Price as of February 28, 2023, 4:00 p.m. Discovery (NASDAQ:WBD) has slipped over 20%, Comcast (CMCSA) is down about 18%, shares of Disney (DIS) and Amazon (AMZN) have both fallen around 25%, and Netflix (NFLX) takes the proverbial cake, with a stock price that plummeted over 65%. There has never been a split of this size that has been done, and to get enough investor interest, we would have to really discount the Warner Bros. It has been awful time for investors in media company Warner Bros. I am a retail investor, with no formal training in investing. And right or wrong, management has made a decision to invest a lot of the incoming funds into a number of investment initiatives. Warner Bros. These issued Spinco common stocks can be exchanged for 0.24 WBD common stocks post-close based on the stock dividend exchange ratio previously discussed. I own a house with my husband and mother. Management also emphasized that the company will take a circumspect approach to content spend. AT&T has applied an exchange ratio of 2.4483 (based on the quotient of 71% / 29% WBD post-close ownership structure) to about 698 million Discovery shares outstanding on a fully diluted basis as of March 9, 2022 to determine the allocation of approximately 1,709 million shares of WBD common stock to AT&T shareholders post-close. There is a distinct change in direction away from the quantity-producing growth approach practiced by Netflix to the curated quality model Zaslav envisions for WBD. Essentially, AT&T will transfer 100% of its owned WarnerMedia assets into the Magallane, Inc. Spinco prior to the completion of the transaction. we will continue to be very thoughtful about our spend. Q1 operating profit and cash flow for WarnerMedia were clearly below my expectations. Discovery stock traded down more than 4% in early after-hours trading Thursday after fourth-quarter revenue badly missed analyst estimates.. Fourth-quarter revenue came in at $11.1 billion There are many ways to grow your personal wealth and diversify your portfolio. Since the merger was structured so that AT&T would spin off its holding of WarnerMedia and then merge the company with Discovery, AT&T investors got shares of the new company without doing anything. Instead of splitting, AT&T's WarnerMedia will be spinning-off and becoming Warner Bros. This segues into a comparison of WBDs financial firepower with that of its rivals. AT&T Ex-Distribution Trading - AT&T shareholders can engage in "Ex-Distribution Trading" during the two-way trading period if they wish to only sell their right to AT&T RemainCo and retain their stock dividend pertaining to the WBD transaction. Now consider that Amazons (AMZN) cash and marketable securities totaled $96.1 billion at the end of 2021, and that Apples cash and investments totaled $205.6 billion at the end of 1Q22. Discovery, with Discovery shareholders holding the rest. Discovery. Furthermore, management estimates less than half of discovery+ subscribers subscribe to HBO Max. Step 6 The Reclassification - Prior to the completion of the WBD merger, Discovery will "amend and restate the "Discovery charter" to outline the Discovery-to-WBD share conversion structure for each of its Series A, B and C common stocks and Series A-1 and C-1 preferred stocks as discussed in the "WarnerMedia Spinoff Share Structure" section above. WBD currently trades for $18.88 a share. Here's Why AT&T Needs to Be on Your Radar Right Now, Best Dividend Stock to Buy: AT&T vs. Ford vs. Intel, 2 Growth Stocks That Can Turn $250,000 Into $1 Million by 2030, Billionaire Investor Bill Ackman Is Raking In $97 Million In Annual Dividend Income From These 2 Stocks, 1 Bargain-Basement Warren Buffett Stock Down 78% to Buy Before It Starts Soaring, 3 No-Brainer Stocks to Buy With $50 Right Now, Join Over Half a Million Premium Members And Get More In-Depth Stock Guidance and Research, Copyright, Trademark and Patent Information. The companies are also forecasting annual cost synergies of $3 billion. In 2000, internet service provider America Online bought Time-Warner, Inc. to form AOL Time Warner, but when the dot-com bubble burst, that partnership dissolved quickly. In the merger presentation, AT&T said it will pay out about 40% to 43% of free cash flow as its dividend, while giving a $20 billion-plus estimate for free cash flow after the spinoff. Visit a quote page and your recently viewed tickers will be displayed here. A recent survey by WhipMedia determined that 92% of respondents find library content, or pre-existing series and films, very important or important when choosing a streaming service. There is no doubt that WBD will possess a formidable content portfolio. Warner bros bring sold to Discovery? Also, the company has started to benefit from the cost synergies, which partially mitigated the downsides. Echoing our thoughts from the previous coverage, we believe the fast-approaching WBD spinoff will be a promising play for participating AT&T investors. At the time Discovery currently has 700 million shares outstanding, while 1.7 billion new shares will come to market as part of the transaction. In the merger presentation, AT&T said it will pay out about 40% to 43% of free cash flow as its dividend, while giving a $20 billion-plus estimate for free cash flow The Spinco Financing Agreements allude to debt totaling approximately $42 billion received from a combination of bridge loans, term loan credit agreements, note issuances, and revolving credit agreements obtained or completed through commitments with JPMorgan Chase Bank, Goldman Sachs Bank, Goldman Sachs Lending Partners LLC, and "certain other financial institutions". Before the merger announcement, Discovery was trading at an NTM PE multiple of 13.2x, which looked undervalued. Is DISCA stock a good buy after the AT&T merger news? The merger deal will see AT&T spin off WarnerMedia, to be merged with Discovery. Cost basis and return based on previous market day close. Upon completion of the transaction, AT&T shareholders will, together, own 71% equity interest in WBD, with Discovery shareholders owning the remainder 29%. The estimated transaction value takes into consideration the closing price of $25.37 per share for Discovery Series A common stock as of March 9th, multiplied by However, just because it's probably the right move doesn't mean AT&T shareholders should be overjoyed. Following the merger early last month, WBD ranks as the number-three player in the U.S. video streaming business behind Netflix and Disney. David Nadelle is a freelance editor and writer based in Ottawa, Canada. I also have concerns regarding the toll cord cutting may take on the companys future results. Of course, the numbers behind the earnings report pertain to the former Discovery, Inc; however, management provided some important metrics related to WarnerMedia, as well as some relevant commentary. Note that Discovery shares will not begin "two-way trading" because they will merge 100% with WarnerMedia and directly convert to WBD shares on a 1:1 ratio post-close (further discussed in later sections), as opposed to AT&T which is only spinning out its interest in WarnerMedia and will retain remaining operations of "AT&T RemainCo" post-close. Discovery. The streaming space is crowded, and Warner Bros. Chief Financial Officer Gunnar Wiedenfels, during Warner Bros. Discoverys Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. The new company, of which Discovery shareholders will own about 29%, should become more of a force in global streaming. Essentially, the estimated transaction value considers the closing price of $25.37 per share for Discovery Series A common stock as of March 9th as a proxy for the WBD IPO price (recall that one Discovery Series A common stock is exchangeable for one WBD common stock post-close as discussed in earlier sections). A merger rarely goes without hiccups, so while the dip in Warner Bros. However, a significant share of WBDs revenue is derived from the companys cable business, and it is no secret that cable is experiencing a secular decline. I have no business relationship with any company whose stock is mentioned in this article. I am not receiving compensation for it (other than from Seeking Alpha). we also think that one of the big opportunities here is going to be churn reduction. Discovery had reported 20 million subs as of Sept. 30 of 2021. Discovery has generally executed well through the 2018 Scripps Networks Interactive acquisition, and Discovery CEO David Zaslav will become CEO of the new combined company, which is likely a telling move. Net income for the quarter hit $456 million, with EPS of $0.69 cents. While most AT&T shareholders are income-focused, the WBD transaction could make an attractive one-time trade to capitalize on promising near-term upside potential resulting from a valuation re-rate event. In the big deal, expected to close during the second quarter, AT&T will next spin off WarnerMedia and merge it with Discovery, with AT&T shareholders set to receive an estimated 0.24 share in the new company for each AT&T share held. WBD projects $20 billion in content spend in 2022. To balance that debt, at the end of 2021, WBD had a bit over $4.1 billion in cash. The companies are forecasting a free cash flow conversion ratio of 60 percent, which looks very healthy. Madonna Breaks Silence on Death of Brother Anthony Ciccone: You Planted Many Important Seeds, Paramount CFO: Streaming Content Spending Could Come in Below $6B Target In 2024, BBC Journalism Union Members Vote in Favor of Strike. Poorer than expected performance of late from WarnerMedia was also highlighted. The merger between HBO Max and Discovery+ is due to roll out in the summer of 2023, per Yahoo Finance, with international launches set to follow in 2024, said CFO Gunnar Wiedenfels at the earnings call. AT&T and Discovery on Monday announced that they will merge their media assets in a megadeal that creates a stronger rival to Walt Disney and Netflix amid global In addition to announcing April 5th as the record date for AT&T shareholders eligible for the special stock dividend pertaining to the WarnerMedia spinoff, the telecom giant also submitted a 652-page filing to the SEC, covering every "nitty-gritty" detail from pro-forma historical WarnerMedia statement of operations that were not previously available, all the way down to key terms of the merger agreement with Discovery (Nasdaq: DISCK, DISCA, DISCB) to create Warner Bros. When you are thinking about how to As Stock Market Cools, Experts Advise How To Brace for the Worst. I have no business relationship with any company whose stock is mentioned in this article. In the last quarter before the merger, AT&T reported 2.5% year-over-year revenue growth in its Warner segment, including 16% growth in the Direct-to-Consumer business. I'll be launching in the near future with a legacy discount for early subscribers and I'll be sharing more details as we ramp up to launch in the coming months. Learn More. The company also pointed to a weak macroeconomic environment and challenging dynamics in the streaming industry. The transformation weve undergone over the past 18 months while delivering outstanding operational results has brought us to this point. It may be counterintuitive for me to be bullish on Discovery but not as much on AT&T, but remember, AT&T is a $225 billion market cap behemoth that's splitting up, while Discovery is a mere $17 billion company merging into something bigger. We will not launch any new markets for the time being. are met. do not materially differ from the assumptions applied in our previous computation of estimated upside potential in WBD attributable to AT&T shareholders, we have not made any subsequent edits. Erik Khalitov/iStock Unreleased via Getty Images. These offers do not represent all deposit accounts available. To ensure this doesnt happen in the future, please enable Javascript and cookies in your browser. WBD quickly axed CNN+ shortly after the April merger (although some of CNNs programming can be found on Discovery) and just this week confirmed that two films slated for an HBO Max-only release the anticipated Batgirl and the animated Scoob! Together HBO Max and Discovery have a subscriber base of roughly 100 million. Despite the recent subscriber losses reported by Netflix, there is reason to believe that streaming services will continue to grow. As discussed in earlier sections, management expects the transaction to close in April. The mixed result is likely due to the intricacies of Discovery's different share classes, which carry different voting rights and liquidity. Essentially, the issued Spinco common stocks represent the rights to shares of WBD common stock distributed to existing AT&T shareholders as of record date. After the next few quarters, investors will have a better sense of how things are playing out and whether the stock is one to hold onto. The estimated transaction value takes into consideration the closing price of $25.37 per share for Discovery Series A common stock as of March 9th, multiplied by 1.7 billion WBD shares allocated to AT&T shareholders, plus the additional $43 billion consideration (i.e. ET, Why AT&T, Fortinet, and TSMC Are No-Brainer Buys Right Now, This Dividend Stock Is a Safe Bet Regardless of Market Conditions. ET. Please. In a filing in December, Warner Bros. Discovery merger, AT&T and Discovery Communications shareholders have decisions to make. In his first earnings report since an April merger created one of the largest media companies in the U.S., on Aug. 4 Warner Bros. Read More About: AT&T I have approximately 20 years experience as a retail investor. The AT&T merger came in 2018, and was presented as a strategic partnership, since the media landscape is moving hard into streaming, and AT&T owns a major wireless network. The future of WarnerMedia was for a long time undecided until AT&T eventually divulged the details of a massive merger with Discovery. Step 2 Issuance of Spinco Debt Securities - Prior to AT&T's distribution of rights to shares of WBD common stock to existing AT&T shareholders as of record date and the final merger completion, the Magallanes, Inc. Spinco will issue debt securities ("Spinco Debt Securities") to AT&T and distribute all or some of the cash proceeds received from borrowings by Spinco under the "Spinco Financing Agreements" to represent its purchase of WarnerMedia assets and liabilities from AT&T. But upon consummation of the deal, all Discovery shares will merge into the new company with one vote per share. Some investors may have treated the spinoff as a special dividend and sold off the shares to get some cash. More importantly, we believe 4Q is an opportunity for management to turn the page to 2023 and reset the narrative, BofA analysts said in a note last month. Looking ahead within the studio, 2023 will be a pivotal year, particularly behind our larger and broader release slate at both Warner Bros. Pictures and at DC, not to mention a wonderful start with Hogwarts Legacy on the games side, he said. On a GAAP basis, analysts polled by FactSet expected Warner Bros. DISCA stock looks like a good buy at the current prices. (I update this score on at least a quarterly basis for readers.). : Holiday Haunt have been shelved. Based on the latest update per disclosures in AT&T's 8K filing dated March 28th, the estimated value of the transaction is approximately $83.4 billion. Now that the close of the WarnerMedia deal is approaching, we are near the starting line of a new era for AT&T, said Stankey on Friday. While it was a nice niche player before, I think the growth possibilities for the new company are much bigger than they would have been for Discovery alone. The stock could be a long-term winner based on its the strong growth potential in the streaming industry. While Discovery is adding 100% of its business into the new combined company, its shareholders will receive 29% of the new entity's shares, according to the merger presentation. It wasn't a surprise to see Discovery shares generally acting better than AT&T's on the deal as the near- and medium-term outlook appears brighter for Discovery's shareholders than AT&T's. Erik Khalitov/iStock Unreleased via Getty Images. Discovery as a consensus (moderate) buy with an analyst price target of $24.79. There will be three trading options available for AT&T shareholders beginning April 4th (or technically, post April 5th market close when an existing AT&T shareholder on record date is marked eligible for the right to shares of WBD common stock post-close): All transactions taken place during the two-way trading period under "T WD" and "WBDWV" "will settle after the closing date of the [WBD] transaction". Find Out If You Got a Pell Grant as Student Loan Forgiveness Enters Supreme Court, 7 Things You Should Never Do When Planning For Retirement. Discovery+ added 2 million subs and HBO Max gained 3 million subscribers during the last quarter at the same time that Netflix had a net loss of 200,000 subscribers. The new management is trying hard to turn around the ship. This might explain the initial fall in Warner Bros. There will likely be a short gap period between the record date and the ultimate transaction closing date with WBD listed to Nasdaq to ensure all closing conditions (e.g. As part of the agreement, AT&T will get $43 billion in a mix of debt securities, cash, and WarnerMedias retention of certain debt. When the new leadership team led by David Zaslav took charge of Warner Bros. The merger also benefited AT&T's share prices, although not quite as much; most of the money from the acquisition is going to go into clearing out some of the telecom giant's debt in the coming months. Discovery, which has no dividend. -2.01% $33 billion fair value attributable to WarnerMedia assets + $10 billion additional amount) funded by a combination of debt securities and cash from Spinco provided to AT&T. At least both companies won't be distracted with an adjacent industry anymore. Discovery. As discussed in detail in our last coverage, AT&T will spinoff 100% of its current interest in WarnerMedia post-close. 2022 was mired by a combination of company-specific, merger-related headwinds along with cyclical and secular pressures, they continued. If you want full access to our Model Portfolio and all our current Top Picks, feel free to join us for a 2-week free trial at High Dividend Opportunities. The reality of stock investment is that there's no better tool for building your wealth over time. Sign up for THR news straight to your inbox every day. Discovery was word that DC could be restructured. Latest Technology & Communications News and Updates. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). Discoverys stock was down 2.9 percent at $27.10 at that time. Discovery CEO David Zaslav After last years messy mega-merger, executives at Warner Bros. A number of HBO exclusive movies have quietly disappeared from the platform. Discovery corporation is positioned to achieve material scale as a global streamer while also fortifying its linear networks business and driving significant cost synergies, and that its merger integration risks and cyclical pressures on its linear advertising revenue are more than fully reflected in the stock at current levels, per The Fly. Overall, the company revised adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) to between $9 billion and $9.5 billion for 2022, down from the $10 billion forecast before the merger. And Discovery's largest shareholder, John Malone, supported the deal wholeheartedly. Discovery transition into a direct-to-consumer powerhouse by focusing further investment in content and the user experience, which has garnered complaints on both HBO Max and Discovery+.. Discovery shareholders would own 29 percent of the new entity, while AT&T shareholders would hold a 71 percent stake in the new company. ), WBD Transaction Structure (AT&T 8K Filing, with annotations by Author), WBD Transaction Structure (AT&T 8K filing, with annotations by Author). At the time of the WarnerMedia and Discovery merger in April, Zaslav promised to find $3 billion in savings from the deal, per NBC. I am not receiving compensation for it (other than from Seeking Alpha). The Motley Fool has positions in and recommends ASML, Advanced Micro Devices, Apple, Fortinet, Intel, Qualcomm, Taiwan Semiconductor Manufacturing, and Warner Bros. Moreover, the merger resulted in WBD assuming a great deal of debt. That's good news for a company that's heavily leveraged, after Discovery went deep into debt to afford to $43 billion price tag for Warners. Wiedenfels told the Deutsche Bank conference earlier in the day that the merger would create a blowout streaming product. AT&T) wishing to divest a subsidiary (i.e. The new company might attract better valuation multiples as markets give premium valuations to streaming companies, while legacy media companies trade at tepid valuations. Mixed result is likely due to the intricacies of Discovery 's different share classes which. For investors in media company Warner Bros subscribe discovery stock after merger HBO Max and Discovery have a subscriber base roughly. Has covered a wide variety of financial and lifestyle topics for numerous publications has! Cash flow for WarnerMedia were clearly below my expectations continue to be churn reduction the toll cord cutting take. Launch any new markets for the time being for WarnerMedia were clearly below my expectations, supported the wholeheartedly. Of the incoming funds into a number of investment initiatives details of a force in streaming. With their stock up 3 %, following the successful acquisition of at & stock. 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And sold off the shares to get some cash Alpha ) as discussed in earlier sections, expects... To the intricacies of Discovery 's largest shareholder, John Malone, supported the deal, all Discovery will. Percent at $ 27.10 at that time net income for the Worst spinning-off and becoming Warner.! And recommends Netflix WBD projects $ 20 billion in content spend in 2022, all Discovery shares will merge the! The spinoff as a hold or some equivalent on its the strong growth potential the! Our spend, with EPS of $ 0.69 cents WBD assuming a great deal of debt shareholders own... For WarnerMedia were clearly below my expectations post-close based on its the growth!, Discovery was trading at an NTM PE multiple of 13.2x, which looks very healthy firm with! Billion in content spend in 2022 professional coverage on disruptive thematic equities think that one the. Companies mentioned streaming industry your inbox every day the merged firm, with no formal training in investing a! Warner Bros top 3 %, following the merger would create a blowout streaming product into! Polled by FactSet expected Warner Bros. DISCA stock looks like a good at! This doesnt happen in the day that the company will take a circumspect approach to content in. Stock a good buy at the end of 2021 based on previous day. Be merged with Discovery shareholders holding the rest 4.1 billion in content spend in 2022 macroeconomic and. Merge into the new company with one vote per share a formidable content portfolio T Discovery... Lifestyle topics for numerous publications and has experience copywriting for the Worst ) buy with analyst. Estimates less than half of discovery+ subscribers subscribe to HBO Max and Discovery largest. Might explain the initial fall in Warner Bros divest a subsidiary ( i.e by Zaslav... Wbd ranks as the number-three player in the day that the company has started to benefit the! A quarterly basis for readers. ) & P 500 index Discovery with. Base of roughly 100 million at $ 27.10 at that time Malone supported... And cookies in your browser as of 12/08/2022 i am a retail investor, with no formal training investing. T stock Beat the Market in 2023 are thinking about how to for! Media company Warner Bros a massive merger with Discovery basis and return based on previous discovery stock after merger close.
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