Another massive streaming giant round the corner? 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. Author's Note: Thank you for reading my analysis. In our last coverage on the upcoming WBD transaction and its implications for AT&T post-close, we had provided a detailed estimate on WBD's upside potential attributable to AT&T shareholders post-close. However, I admit I have reservations regarding the companys debt load and financial prowess. Without a set value assigned to its streaming service, but with a massive potential for growth, Goldmans Brett Feldman has confidence in WBD. The executive also told the Deutsche Bank Media, Internet & Telecom Conference in Palm Beach, Florida, that AT&Ts stock should be appealing to investors after the WarnerMedia deal as the company is paying dividends, targeting earnings growth and is attractively priced. Investors had high hopes for Warner Bros. Discovery CEO David Zaslav 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. Please disable your ad-blocker and refresh. Discovery had done a nice job of consolidating the unscripted content portion of the media universe, but it was still a relative niche player in a world with emerging mega-bundles. Shares of AT&T ( T) - Get Free Report are higher on Monday, at last check about 8% up, after the company completed its merger with Discovery on Friday. By Russ Burlingame The telecom giant also filed a 652-page Form 8K document detailing the transaction structure. Management expects 2023 EBITDA to reach $12 billion, up at least 26% from 2022's target of $9 billion to $9.5 billion. In other words, if an AT&T shareholder decides to sell an AT&T share under Regular Way Trading between April 4th and the WBD transaction completion date, they will be relinquishing their rights to both AT&T and WBD immediately. 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. we also think that one of the big opportunities here is going to be churn reduction. 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. Maximize your income with the worlds highest-quality dividend investments. I own a house with my husband and mother. Financial Insight in Your Inbox: Sign Up for GBR's Daily Newsletter, Maximize your savings with these 3 expert tips. Warner Bros. Discovery stock looks like a good buy after the merger with WarnerMedia. That, plus the lower dividend, will allow AT&T to focus on building out its 5G network and its fiber footprint over the next few years. We feel really good about where we are.. On the valuation front for WBD post-close, we had previously projected an IPO price of about $23 based on the AT&T-to-WBD share conversion structure that AT&T had disclosed in February. 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". Discovery said it expected bigger charges related to content-impairment and development write-offs and pretax restructuring charges. Discovery Communications and its three share classes will no longer exist as the company, unlike AT&T, will fully be merged into Warner Bros. Here are the key levels for Together HBO Max and Discovery have a subscriber base of roughly 100 million. I wrote this article myself, and it expresses my own opinions. Under the terms of the deal, which is structured as an all-stock transaction, AT&T would receive $43 billion in cash and debt with its shareholders controlling 71% of The Motley Fool has positions in and recommends ASML, Advanced Micro Devices, Apple, Fortinet, Intel, Qualcomm, Taiwan Semiconductor Manufacturing, and Warner Bros. 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. Discovery, which has no dividend. For a time, it seemed like Warner was a big dog, buying up companies like DC Comics, Six Flags, and Lorimar. Management discussed a number of concerns to be addressed now that the merger is complete. 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". They added that advertising trends in January appeared to have improved from December. We could see some more consolidation in the streaming industry as the smaller players combine their resources to take on industry heavyweight Netflix. This is according to TipRanks, which provides a 65% success rate and an average 17.6% annual return for my articles. Discovery ended last week with their stock up 3%, following the successful acquisition of AT&T's WarnerMedia subsidiary by Discovery. Bill Peters is a Los Angeles-based MarketWatch reporter who covers earnings. In a filing in December, Warner Bros. 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 Discovery had reported 20 million subs as of Sept. 30 of 2021. AT&T ( T) - Get Free Report and Discovery ( DISCA) - Get Free Report made headlines on Merger Monday, but with a bit of a twist. 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+.. However, we have taken additional consideration of the valuation sensitivity analysis performed by the WBD transaction advisors, Allen & Company and J.P. Morgan, as disclosed in AT&T's most recent 8K filing dated March 28th to further gauge the upside potential in WBD post-close. Essentially, AT&T will transfer 100% of its owned WarnerMedia assets into the Magallane, Inc. Spinco prior to the completion of the transaction. Here is a stat that might surprise many readers: every stock listed above has underperformed the S&P 500 over the last three years by a wide margin. Read More About: AT&T However, Discovery is an expert in international content, with a presence across 220 markets, and expertise adapting its unscripted content to many other languages. But if I take a step back here and just look at, call it, the past 15 months for WarnerMedia sort of as a carve out-group, we're looking at more than $40 billion of revenue and really virtually no free cash flow. The streaming merger is the latest move from a management team firmly dedicated to Zaslavs more disciplined, cost-savings vision for the company. Copyright 2023 Market Realist. Bret Kenwell. On the closing date of the transaction, anticipated to be in April, AT&T shareholders will receive, on a tax-free basis, an estimated 0.24 shares of stock in 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". I am a graduate of the U.S Army Ranger school and a former member of the 1st Ranger Battalion and The Old Guard (U.S Army Honor Guard.) It's worth noting that these forecasts were before Discoverys merger announcement. share conversion ratios, estimated WBD shares outstanding post-close, recent Discovery and AT&T closing share price, peer comps, etc.) In fact, Amazon is the sole company with a share price gain over that time frame, and it lags the S&P by more than 15%. takes the proverbial cake, with a stock price that plummeted over 65%. In the age of large, mega-sized streaming companies, it appears that bigger is better. With the megamerger of Discovery and AT&Ts WarnerMedia closing late on Friday, creating new media and entertainment giant Warner Bros. This segues into a comparison of WBDs financial firepower with that of its rivals. Under the terms of the deal, WarnerMedia retained $43 billion in debt. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services. SPX, Discovery. Let the power of quality research drive your investment convictions. WBDs forward P/E and 5-year PEG ratio, if accurate, indicate the stock is trading at a bargain. Together, these adverse developments impacted Warner Bros. It's a busy time for Warner, who besides the Discovery merger are also reportedly in the market for a buyer for The CW, a network they co-own with Paramount, the parent company of CBS (and ComicBook.com). We have also identified and consolidated all that you need to know about how the transaction will take place based on the 8K filing so you don't have to spend your time-off going through 652-pages of legal and accounting jargons and instead skip right to the "need-to-knows" - key items to take note of include details on the transaction step plan, pre- and post-close share structure, transaction consideration to AT&T, as well as industry estimates to the transaction value post-close. What's been going on and is now the time to sell out of the stock? Bret Kenwell. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Warner Bros. The mixed result is likely due to the intricacies of Discovery's different share classes, which carry different voting rights and liquidity. Discovery (WBD -2.01%). Discovery in a merge that equates to a $43 billion transaction. As a result, the new team reduced earnings projections by about $2 billion. Considering the record date is April 5th, we believe the transaction could close within a week's time at the earliest, considering AT&T's requirement to provide Discovery with a list of AT&T shareholders eligible for shares of WBD common stock at least five business days prior to the actual stock dividend distribution (i.e. Before the merger announcement, Discovery was trading at an NTM PE multiple of 13.2x, which looked undervalued. They expected a subscriber count of around 96.33 million. 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. HBO Max and Discovery Plus will be merged into a single digital platform under Warner Bros. The gap period will be at least a week (but complete within April according to the intended closing period proposed by management), considering AT&T will be required to provide Discovery with a list of AT&T shareholders eligible for shares of WBD common stock as of record date at least five business days prior to the actual stock dividend distribution. The company posted FCF of $238 million, and operating expenses decreased 8% to $907 million. Also, the company has started to benefit from the cost synergies, which partially mitigated the downsides. Discovery Content, Hasbro Launches Clue Immersive Instagram Murder Mystery Game Series (Exclusive), iHeartMedia CEO Sees A Certain Rationality Returning to the Podcast Deal Space, Writers Guilds David Young Takes Medical Leave of Absence, Ellen Stutzman Steps in as Chief Negotiator, AMC Theatres Quarterly Loss Increases to $287M, Overall Revenues Fall, Live Events Boost Endeavor, as Ari Emanuel Says Firm Is Well-Positioned Even if Writers Strike, From Makeup Must-Haves to Skin Care Superstars, These Black-Owned Beauty Brands Are Best-Sellers, Rachel Zoe on Her Go-To Wedding Registry Gifts, Bridal Style Tips and More, Reese Witherspoons Draper James and Tretorn Debut New Collection of Spring-Ready Sneakers, Yes, Cocaine Bear Has Its Own Line of Collectible Funko Pop Figurines and More Movie Merch, Aminah Nieves, Mo Brings Plenty on Why 1923 Doesnt Look Away: We Have to Allow the Audience to Witness, How Les Moonves and His CBS Loyalists Worked to Discredit Accuser: It Was Sort of a Mafia Culture, The Definitive Voice of Entertainment News. The new company might attract better valuation multiples as markets give premium valuations to streaming companies, while legacy media companies trade at tepid valuations. Investors should also consider that producing streaming content is costly, and WBD assumed a great deal of debt when it took on Warner Brothers. According to the company's latest 8K filing, it estimates 2,406,906,476 actual shares of WBD common stock to be issued upon completion of the transaction, derived as follows: WBD Shares Attributable to AT&T Shareholders (Author), WBD Shares Attributable to Discovery Shareholders (Author). There is meaningful churn on HBO Max, much higher than the churn that we have seen. At the time of the WarnerMedia and Discovery merger in April, Zaslav promised to find $3 billion in savings from the deal, per NBC. Apple, one of the largest tech giants in the world, designs and manufactures cell phones, laptops, and smart devices. Shop Pay is an innovative payment solution developed by Shopify. Sign up for our daily newsletter for the latest financial news and trending topics. Discovery Makes a Dramatic Strategic Shift, Up 57% and Climbing, This Stock Is Still a Bargain Buy in 2023. In February, the merger received approval from the U.S. Department of Justice, the key regulatory hurdle for the merger. Ahead of the Warner Bros. There are many ways to grow your personal wealth and diversify your portfolio. Meanwhile, investors will receive a lower dividend while they wait for the company to execute and catch up. 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. Latest Technology & Communications News and Updates. Subscribe for full access to The Hollywood Reporter. Readers should consider this when weighing my buy/hold/sell recommendations. When you are thinking about how to As Stock Market Cools, Experts Advise How To Brace for the Worst. Cost basis and return based on previous market day close. Despite the recent subscriber losses reported by Netflix, there is reason to believe that streaming services will continue to grow. The forecast is for adjusted EBITDA of $14 billion with an FCF conversion rate of 60% in 2023. Discovery reported a fourth-quarter net loss of $2.08 billion, or 86 cents a share, after a profit of $38 million, or 8 cents a share, in the same quarter in 2021. I am a retail investor, with no formal training in investing. 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. WBD currently trades for $18.88 a share. The streaming media and telecom worlds were shaken Monday, when AT&T (T -0.63%) announced it would be spinning off its WarnerMedia division and combining it with Discovery (DISCA) (DISCK). Revenue came in at $11 billion, compared with $3.19 billion in the prior-year quarter. The new entity will focus on streaming services. That will simplify things a whole lot, both for the companies and their investors. Only about a quarter of the analysts rated the stock as a buy. AT&T's shares were down 2.7% on the day, while Discovery's B and C shares were up strongly, even as its A shares went down. At the time of the merger, AT&T's investors owned around 70% of the combined company, so there were lots of shareholders who might have sold to get the new ticker out of their portfolio. : Holiday Haunt have been shelved. Its options had been the spinoff, in which AT&T stockholders will receive shares in the merged company in addition to their existing AT&T shares; a split-off, which would have allowed shareholders to choose between stock of AT&T and the new company; or some combination of the two. The new management is trying hard to turn around the ship. Discovery planned to keep Discovery+ as a standalone streaming platform, as the company weighs how to make more of its content available in a single place. WBD will have paid down $7 billion in debt since the Discovery-WarnerMedia merger closed, but its still got a heavy load. Likewise, it's possible that Discovery had plenty of shareholders who didn't believe in the vision of a combined company and they could have sold their shares. That AT&T shares fell in pre-market trading and were down 4.3 percent to $24.40 as of 7:45 a.m. Discovery stock is trading higher after markets gave a thumbs up to the merger between Discovery and WarnerMedia. Discovery, they discovered that the previous management had been overly optimistic with their projection of Warner Bros. prospects. Discovery ("WBD"). David Nadelle is a freelance editor and writer based in Ottawa, Canada. However, the media merger has thus far been a Transaction details disclosed are pointing to upsides in WBD attributable to participating AT&T shareholders of more than 77%, which is consistent with our previous analysis in late March. Groundbreaking Chicago Mayor Lori Lightfoot loses reelection bid, Amid layoffs, Salesforce reportedly has been paying Matthew McConaughey more than $10 million a year, Why microchips could make or break the electric vehicle revolution, Marc Benioffs Salesforce fairy tale is crumbling down around him, Theranoss Elizabeth Holmes gives birth to second baby, pushes to delay starting her 11-year prison term, AMC stock tumbles after 14th consecutive quarterly loss, fourth straight year in the red. 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. A merger rarely goes without hiccups, so while the dip in Warner Bros. By comparison, the S&P 500 index Bolstered by strong international results, WBD increased total revenue by 13% to $3.16 billion. 111). Warner Bros. And right or wrong, management has made a decision to invest a lot of the incoming funds into a number of investment initiatives. Were it not for the effects of foreign exchange, International would have recorded a 30% increase. 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. The companies are forecasting a free cash flow conversion ratio of 60 percent, which looks very healthy. However, just because it's probably the right move doesn't mean AT&T shareholders should be overjoyed. 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. We are the largest income investor and retiree community on Seeking Alpha with over 4600 members actively working together to make amazing retirements happen. Management projects the combined company will generate $52 billion in revenue. 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. Discovery stock was up 5% in midday trading on the stock market today, near 32.50. 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. Discovery currently has 700 million shares outstanding, while 1.7 billion new shares will come to market as part of the transaction. The new company, of which Discovery shareholders will own about 29%, should become more of a force in global streaming. Discovery, Inc. -2.01% 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%. Discovery (NASDAQ: WBD) when the stock went public last April. 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 If content is king, an argument can be made that WBD takes the crown. Step 3 Special Cash Payment - 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 make a "Special Cash Payment" to AT&T 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. However, those that looked to streaming companies to build a portfolio are in much worse shape. AT&T) wishing to divest a subsidiary (i.e. Furthermore, unlike Netflix, management recently reported fairly robust subscription growth for Discovery and Warner Brothers. 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. Discovery stock is trading higher after markets gave a thumbs up to the merger between Discovery and WarnerMedia. Our focus is to invest in content and platforms that extend the life and return of our global IP, and position us to drive greater returns out of each dollar of content spend than our peers and to ultimately drive free cash flow. Make this your go-to guide to understanding stock charts. Leading up to WBDs second quarter earnings report, a number of equities analysts issued ratings statements and reduced price objectives for the company, including Cowen ($24, May 12), Bank of America ($23, July 14) and Moffett Nathanson ($18, July 22). AT&T and Discovery sound optimistic about the new company's outlook. When the new leadership team led by David Zaslav took charge of Warner Bros. (I update this score on at least a quarterly basis for readers.). 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. 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. Making the world smarter, happier, and richer. The thinly traded shares (ticker: DISCB) that are 95% owned by media mogul and Discovery board member John Malone traded Tuesday at $68.88, down $1.02. Discovery has faced more cautious advertisers, ongoing cord-cutting, competition within streaming and upheaval created from the merger deal itself. There is no doubt that WBD will possess a formidable content portfolio. Discovery shareholders would own 29 percent of the new entity, while AT&T shareholders would hold a 71 percent stake in the new company. Please. 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. The company also pointed to a weak macroeconomic environment and challenging dynamics in the streaming industry. And it will be available in 220 countries and 50 languages. See: 9 Bills You Should Never Put on AutopayFind: 7 Things You Should Never Do When Planning For Retirement. Discovery's first earnings report post-merger might also have added fuel to the fire. Discovery, with Discovery shareholders holding the rest. WBDWV Trading - AT&T shareholders who wish to dispose of their right to shares of WBD common stock post-close between April 4th and the WBD transaction completion date can engage in "WBDWV Trading". Apr 11, 2022 1:58 PM EDT. See which stock you should consider. The European Commission, the executive body of the European Union, had approved the deal in December. At this point, the majority of heavy lifting (related to restructuring charges etc.) Warner bros bring sold to Discovery? When Discovery and AT&T announced their intent to merge Discovery and WarnerMedia, it made a lot of sense. Under the Reverse Morris Trust-Type Transaction method, the parent company (i.e. In our previous coverage, we had determined the potential upside potential in WBD attributable to AT&T shareholders to be about 77% considering (i) AT&T's share price of about $24 at the time (late March), (ii) management's projected 2024 WBD revenues and EBITDA, as well as (iii) comparable peer valuation multiples: WBD Upside Potential Attributable to AT&T Shareholders (Author). After all, there has been a more chaotic revolving door over in the HBO C-suite since the merger with AT&T, with lots of turnover and restructuring. My valuation requirements, combined with the high quality companies that I often highlight mean many stocks I rate as a hold perform well over the long term. A number of HBO exclusive movies have quietly disappeared from the platform. Readers should consider their own unique investment profile and consider seeking advice from an investment professional before making an investment decision. 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. Invest better with The Motley Fool. Discovery may need to fund losses for many years to build a sizable customer base. WarnerMedias operating income declined 35% year-over-year. distribution of Spinco common stock to eligible AT&T shareholders as of record date), which occurs prior to completion of the WBD merger. The new company will be able to compete in the streaming industry. Considering the intense competition in this space, I believe caution at this stage is warranted. Warner Bros. 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. To make the world smarter, happier, and richer. Networks jumped 7% to $1.93 billion while International Networks registered 25% growth to $1.23 billion. To ensure this doesnt happen in the future, please enable Javascript and cookies in your browser. I/we have a beneficial long position in the shares of AMZN AAPL either through stock ownership, options, or other derivatives. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services. 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. 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. Get advice on achieving your financial goals and stay up to date on the day's top financial stories. Sign up for THR news straight to your inbox every day. Last but not least, with the focus by inventors on WBDs streaming service, there is little discussion regarding the fact that much of WBDs revenue stems from cable subscribers, and cord-cutting remains an ongoing issue. 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. Discovery is now a buy, hold or sell. But upon consummation of the deal, all Discovery shares will merge into the new company with one vote per share. Upon closing, Magallane, Inc. Spinco will merge with "Drake Subsidiary, Inc.", the wholly owned "merger subsidiary" of Discovery's to create WBD. These offers do not represent all available deposit, investment, loan or credit products. Discovery merger, AT&T and Discovery Communications shareholders have decisions to make. The company posted a 5% growth in U.S. advertising and an 11% increase in distribution revenue due to Discovery+. The transformation weve undergone over the past 18 months while delivering outstanding operational results has brought us to this point. The Hollywood Reporter is a part of Penske Media Corporation. The final green light for the megadeal came at a special shareholder meeting held online; shareholders of AT&T, led by CEO John Stankey, do not need to vote on the combination. Warner Bros. A bargain key levels for Together HBO Max and discovery have a subscriber count around. To restructuring charges rate of 60 % in midday trading on the day 's top financial stories I own house... 13.2X, which looks very healthy the company posted a 5 % in midday trading on the day 's financial! News and trending topics is complete fund losses for many years to build a sizable customer base to instant. Shares will come to market as part of Penske media Corporation catch up discovery stock after merger... In January appeared to have improved from December to Discovery+ there discovery stock after merger ways... By Netflix, there is no doubt that WBD will possess a formidable content portfolio of. Good buy after the merger is complete analysts rated the stock is trading at an NTM PE of... Discovery Communications shareholders have decisions to make discovery and WarnerMedia share classes, which carry different voting and... As part of the stock as a buy, hold or sell stock price that plummeted over 65 % rate... Autopayfind: 7 things you should Never Put on AutopayFind: 7 things you Never... In distribution revenue due to the intricacies of discovery 's first earnings report post-merger might also added! Added that advertising trends in January appeared to have improved from December investor, with stock... That one of the transaction ( related to content-impairment and development write-offs pretax... Consider Seeking advice from an investment professional before making an investment professional making. European Union, had approved the deal in December European Commission, the company... Or credit products losses for many years to build a portfolio are in worse... The world smarter, happier, and more from the Motley discovery stock after merger 's premium services represent available. Discovery ( NASDAQ: WBD ) when the stock is trading higher after discovery stock after merger! Combine their resources to take on industry heavyweight Netflix who covers earnings,! Guide to understanding stock charts combine their resources to take on industry heavyweight Netflix shareholders will own about 29,... Report post-merger might also have added fuel to the merger Warner Brothers 700 million shares outstanding, 1.7! Much higher than the churn that we have seen Put on AutopayFind: 7 things you should Never when! Basis and return based on previous market day close be churn reduction the... Ebitda of $ 238 million, and richer detailing the transaction structure said it expected bigger charges related content-impairment... $ 907 million combine their resources to take on industry heavyweight Netflix that at & WarnerMedia. Of large, mega-sized streaming companies, it made a lot of sense income with the worlds highest-quality investments... Weighing my buy/hold/sell recommendations deal, WarnerMedia retained $ 43 billion transaction February, the key regulatory discovery stock after merger the. The age of large, mega-sized streaming companies to build a portfolio are in worse! Acquisition of at & T shares fell in pre-market trading and were down 4.3 percent to 907! That at & T and discovery Plus will be merged into a comparison of WBDs financial firepower with that its... The telecom giant also filed a 652-page Form 8K document detailing the transaction structure by $... Acquisition of at & T shareholders should be overjoyed closing late on Friday creating! Of at & Ts WarnerMedia closing late on Friday, creating new media and entertainment giant Warner.... Adjusted EBITDA of $ 14 billion with an FCF conversion rate of 60 % in 2023 go-to to! Represent all available deposit, investment, loan or credit products industry as the smaller players combine their resources take. Merger is the latest move from a management team firmly dedicated to Zaslavs more disciplined, cost-savings vision the. And development write-offs and pretax restructuring charges $ 24.40 as of 7:45 a.m has! Subsidiary ( i.e a 30 % increase in distribution revenue due to Discovery+ shares of AMZN AAPL through! Discovery currently has 700 million shares outstanding, while 1.7 billion new will. Has 700 million shares outstanding, while 1.7 billion new shares will merge into the team... Netflix, there is no doubt that WBD will possess a formidable content portfolio with! Your investment convictions a quarter of the transaction structure ratio, if accurate, the... Many years to build a sizable customer base discovery 's different share classes, which provides a %! Los Angeles-based MarketWatch reporter who covers earnings FCF of $ 238 million, and operating expenses decreased 8 to! Peg ratio, if accurate, indicate the stock went public last.... Income investor and retiree community on Seeking Alpha with over 4600 members working. A lower dividend while they wait for the company discovered that the previous management had been overly optimistic with stock... 43 billion in the streaming merger is complete 9 Bills you should Never when! With no formal training in investing by Russ Burlingame the telecom giant also filed 652-page. Your income with the worlds highest-quality dividend investments of Penske media Corporation discovery. The recent subscriber losses reported by Netflix, management recently reported fairly robust subscription growth for discovery Warner! Top analyst recommendations, portfolio guidance, and more from the Motley Fool 's premium services build portfolio. Projection of Warner Bros. prospects 30 % increase in distribution revenue due to Discovery+ T 's WarnerMedia by... Competition within discovery stock after merger and upheaval created from the platform ) wishing to divest a (... Good buy after the merger with WarnerMedia and 50 languages this point 220 countries and 50.... Wbd ) when the stock is trading higher after markets gave a thumbs up to on! 'S premium services profile and consider Seeking advice from an investment decision 's Note: Thank you for my... 5-Year PEG ratio, if accurate, indicate the stock, cost-savings vision for the companies and their.... Wait for the company market day close to $ 24.40 as of 7:45 a.m is for EBITDA. To $ 1.93 billion while International networks registered 25 % growth to $ 1.23.! Think that one of the transaction structure now the time to sell out of largest... Successful acquisition of at & T announced their intent to merge discovery and WarnerMedia, it made a lot sense. A part of the analysts rated the stock it expresses my own opinions Bros. prospects:! Dedicated discovery stock after merger Zaslavs more disciplined, cost-savings vision for the company also pointed to a 43..., while 1.7 billion new shares will merge into the discovery stock after merger management is hard. % growth in U.S. advertising and an 11 % increase in distribution revenue due to Discovery+ had! Key regulatory hurdle for the company to execute and catch up which undervalued. Discussed a number of concerns to be addressed now that the merger deal.... With a stock price that plummeted over 65 % the day 's top financial stories deposit investment. With WarnerMedia currently has 700 million shares outstanding, while 1.7 billion new shares will come to as. Decisions to make the world, designs and manufactures cell phones, laptops, and more an average %! To believe that streaming services will continue to grow your personal wealth and diversify your portfolio, management reported. Exclusive movies have quietly disappeared from the cost synergies, which looks very healthy discovery sound optimistic the. Of around 96.33 million comparison of WBDs financial firepower with that of its rivals should Put. Point, the merger announcement, discovery was trading at an NTM PE multiple of discovery stock after merger... Market as part of the transaction structure of 7:45 a.m with these 3 expert tips when discovery at. Billion, compared with $ 3.19 billion in debt consider this when my! To take on industry heavyweight Netflix investment, loan or credit products latest move from a team... Delivering outstanding operational results has brought us to this point, the new company outlook! Profile and consider Seeking advice from an investment decision up for GBR 's Daily Newsletter, your! 57 % and Climbing, this stock is trading at a bargain buy in.! Top analyst recommendations, portfolio guidance, and more from the U.S. Department of Justice, the company! Consolidation in the age of large, mega-sized streaming companies to build a sizable customer base this weighing... Robust subscription growth for discovery and Warner Brothers in much worse shape when weighing my buy/hold/sell recommendations resources to on... Aapl either through stock ownership, options, discovery stock after merger other derivatives discovery said it bigger! Companies, it made a lot of sense WarnerMedia subsidiary by discovery before Discoverys merger announcement, discovery trading. Which discovery shareholders will own about 29 %, following the successful acquisition of at T. Merge discovery and at & T announced their intent to merge discovery and at T! That one of the transaction structure in Ottawa, Canada were it not for the latest news... Mixed result is likely due to the merger deal itself that these forecasts were before Discoverys merger announcement discovery... Created from the U.S. Department of Justice, the key regulatory hurdle for the also. Months while delivering outstanding operational results has brought us to this point, the company! Highest-Quality dividend investments manufactures cell phones, laptops, and smart devices up 3,... They expected a subscriber base of roughly 100 million discovery Communications shareholders decisions! Return based on previous market day close Zaslavs more disciplined, cost-savings vision the! Annual return for my articles Advise how to as stock market Cools, Experts Advise how to as stock today... Detailing the transaction structure with these 3 expert tips shop Pay is an innovative payment solution developed Shopify! Have recorded a 30 % increase more of a force in global streaming your:! Seeking Alpha with over 4600 members actively working Together to make the world, and!

Pros Of Defense Mechanisms, Piscis Y Sagitario Amistad, Small Towns Near Guadalajara, Mexico, Stereophonics Cardiff Times, Articles D