Latest news with #KannanVenkateshwar
Globe and Mail
a day ago
- Business
- Globe and Mail
'Operational Friction': Warner Bros Discovery Stock (NASDAQ:WBD) Jumps as Some Worry About the Split's Impact
Entertainment giant Warner Bros. Discovery (WBD) recently made a move that was, seemingly, inevitable: to take its linear cable content and spin it off from its streaming video content and put the two packages into their own operations. And investors were over the moon about this, and remain so today. Not everyone is so certain this idea will work, though. But shareholders were definitely on board, and sent Warner shares up nearly 4% in Tuesday afternoon's trading. Confident Investing Starts Here: Easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions Receive undervalued, market resilient stocks right to your inbox with TipRanks' Smart Value Newsletter Barclays analyst Kannan Venkateshwar, who has nearly a five-star rating on TipRanks, noted that the move may produce 'operational friction,' especially given how some of these operations may need to be restructured from the ground up to separate. Venkateshwar pointed out that Max is actually bundled with Warner's linear content, so separating the linear content from the streaming content would likely require those bundles to be reworked as well. Moreover, the separation also fails to address the matter of $37 billion in outstanding debt that Warner still carries. Warner is putting the linear stuff into the hands of Chief Financial Officer Gunnar Wiedenfels, who noted that 'global networks' would have most of Warner's debt. The streaming and studios business, meanwhile, would maintain a smaller, '…but not insignificant…' portion therein. And Then the Bondholders Saw the Bag They Were Holding One more problem emerged out of the Warner split: bondholders. Three years ago, Warner sold what was one of the biggest 'high-grade corporate bonds on record,' reports noted. Now, those who bought in are left with a disastrous choice. Warner is buying back up to 40% of those bonds, thanks to a $17.5 billion bridge loan. But no matter whether holding or selling, the bondholders now have a bigger problem. Part of the condition of selling, reports note, is the loss of 'key safeguards' on other Warner securities they might own. But those who keep the notes to keep those safeguards will find their position in the creditor line pushed back should that become an issue later on. Cooperation pacts, the reports note, will also be tougher to form, meaning that bondholders that actually keep their debt will have fewer protections overall. Is WBD Stock a Good Buy? Turning to Wall Street, analysts have a Moderate Buy consensus rating on WBD stock based on nine Buys and eight Holds assigned in the past three months, as indicated by the graphic below. After a 18.53% rally in its share price over the past year, the average WBD price target of $12.43 per share implies 25.3% upside potential. See more WBD analyst ratings Disclosure Disclaimer & Disclosure Report an Issue
Yahoo
2 days ago
- Business
- Yahoo
Barclays says Warner Bros. upside depends on recapitalization
Barclays analyst Kannan Venkateshwar says Warner Bros. Discovery (WBD) formally announced a split of the company into two, which has been expected by investors since it announced a restructuring of the company into two divisions last year. The company has $37B of gross debt and another $5B of off balance sheet debt and neither standalone entity will have enough EBITDA to absorb this on a standalone basis without a significant increase in leverage, the analyst tells investors in a research note. Barclays believes realizing valuation upside will depend more on a future recapitalization path rather than the announcement this morning. It keeps an Equal Weight rating on Warner Bros. Discovery with a $9 price target Easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions Receive undervalued, market resilient stocks right to your inbox with TipRanks' Smart Value Newsletter Published first on TheFly – the ultimate source for real-time, market-moving breaking financial news. Try Now>> See today's best-performing stocks on TipRanks >> Read More on WBD: Disclaimer & DisclosureReport an Issue Morning Movers: Warner Bros. Discovery climbs after plans to separate Warner Bros Stock (WBD) Surges on Streaming Split Plan Warner Bros. Discovery to separate into two publicly traded companies Warner Bros. Discovery to separate into two media companies Now Streaming: UBS raises price target on Netflix amid 'solid' viewership
CNBC
07-05-2025
- Business
- CNBC
Disney's beat-and-raise quarter has analysts upbeat about further gains
Disney's strong quarterly results and full-year guidance raise has analysts giddy at the media giant's prospects. The company posted fiscal second-quarter earnings and revenue that exceeded consensus estimates, driven in part by an unexpected uptick in streaming subscribers and upped its full-year guidance. The report sent Disney shares up more than 10%, boosting the Dow Jones Industrial Average. Wednesday's gain put share on pace for their best day since April 9. Heading into Disney's earnings release, analysts were closely awaiting the company's theme parks and streaming results — segments viewed as highly vulnerable to macro weakness. The company managed to post revenue growth across all its segments during the fiscal third quarter. Here are what some of the top analysts on Wall Street said after Disney reported earnings: Barclays reiterates overweight rating and $115 target According to analyst Kannan Venkateshwar, Disney has the least structural risks relative to other media companies — in addition to the largest potential gains from its streaming business. This price target implies 24.8% upside from Tuesday's close. "The company's performance in the first half and guidance for the rest of the year should help investors gain more conviction around growth trajectory. … Overall, we continue to believe Disney remains one of the most attractive investments in our coverage universe despite obvious macro exposure." Bank of America maintains buy rating, $140 price target Analyst Jessica Reif Ehrlich noted that Disney's earnings growth outlook increase is encouraging with recent macro concerns in mind. Her target price of $140 per share implies nearly 52% upside. "Near term catalysts include: 1) profitability inflection in DTC, 2) reacceleration in the Parks business and 3) strong film slate which drives other businesses (DTC, Parks and Consumer Products)." UBS reiterates buy rating, $105 price target Analyst John Hodulik highlighted Disney's "resilient results," as well as its 29% year-over-year growth in advertising across its sports segment. "Total revenues grew 7% y/y (UBSe 4%/Street 5%), while segment OI grew 15% to $4.44B (UBSe $4.06B, Street $3.98B)." Goldman Sachs keeps buy rating, $140 target Analyst Michael Ng pointed to outperformance in the company's experiences division, which was driven by better-than-expected domestic theme park attendance. Ng is bullish on the profitability prospects for Disney, as well as improved studio costs and theme park growth. His price target implies upside of more than 51% from Tuesday's close. "We are Buy-rated on DIS as we believe the company is a high quality EPS compounder supported by 1) continued progression to scaled long term DTC profitability made possible by wholesale arrangements, bundled offerings, password sharing restrictions and other initiatives; 2) studio performance improvement (from a period of under earning) enabled by cost rationalization and organizational restructuring."
