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WARNER BROS DISCOVERY INC (WBD) Stock Fundamental Analysis

NASDAQ:WBD - Nasdaq - US9344231041 - Common Stock - Currency: USD

7.92  -0.33 (-4%)

Premarket: 7.91 -0.01 (-0.13%)

Fundamental Rating

2

We assign a fundamental rating of 2 out of 10 to WBD. WBD was compared to 72 industry peers in the Entertainment industry. WBD has a bad profitability rating. Also its financial health evaluation is rather negative. WBD is valied quite expensively at the moment, while it does show a decent growth rate.


Dividend Valuation Growth Profitability Health

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2

1. Profitability

1.1 Basic Checks

WBD had negative earnings in the past year.
In the past year WBD had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: WBD reported negative net income in multiple years.
WBD had a positive operating cash flow in each of the past 5 years.
WBD Yearly Net Income VS EBIT VS OCF VS FCFWBD Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 5B -5B -10B

1.2 Ratios

WBD has a Return On Assets of -10.82%. This is in the lower half of the industry: WBD underperforms 62.50% of its industry peers.
Looking at the Return On Equity, with a value of -33.23%, WBD is in line with its industry, outperforming 44.44% of the companies in the same industry.
WBD has a Return On Invested Capital (0.51%) which is comparable to the rest of the industry.
Industry RankSector Rank
ROA -10.82%
ROE -33.23%
ROIC 0.51%
ROA(3y)-6.3%
ROA(5y)-2.79%
ROE(3y)-18.63%
ROE(5y)-8.08%
ROIC(3y)N/A
ROIC(5y)N/A
WBD Yearly ROA, ROE, ROICWBD Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 10 -10 -20 -30

1.3 Margins

WBD has a Operating Margin (1.46%) which is in line with its industry peers.
In the last couple of years the Operating Margin of WBD has declined.
Looking at the Gross Margin, with a value of 43.00%, WBD is in line with its industry, outperforming 50.00% of the companies in the same industry.
In the last couple of years the Gross Margin of WBD has declined.
Industry RankSector Rank
OM 1.46%
PM (TTM) N/A
GM 43%
OM growth 3Y-55.14%
OM growth 5Y-45.05%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-11.55%
GM growth 5Y-8.3%
WBD Yearly Profit, Operating, Gross MarginsWBD Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 20 -20 40 60

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2

2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), WBD is destroying value.
The number of shares outstanding for WBD has been increased compared to 1 year ago.
WBD has more shares outstanding than it did 5 years ago.
WBD has a worse debt/assets ratio than last year.
WBD Yearly Shares OutstandingWBD Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 500M 1B 1.5B 2B
WBD Yearly Total Debt VS Total AssetsWBD Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 20B 40B 60B 80B 100B

2.2 Solvency

WBD has an Altman-Z score of 0.38. This is a bad value and indicates that WBD is not financially healthy and even has some risk of bankruptcy.
With a Altman-Z score value of 0.38, WBD perfoms like the industry average, outperforming 47.22% of the companies in the same industry.
The Debt to FCF ratio of WBD is 9.03, which is on the high side as it means it would take WBD, 9.03 years of fcf income to pay off all of its debts.
WBD's Debt to FCF ratio of 9.03 is fine compared to the rest of the industry. WBD outperforms 63.89% of its industry peers.
WBD has a Debt/Equity ratio of 1.09. This is a high value indicating a heavy dependency on external financing.
WBD has a Debt to Equity ratio (1.09) which is in line with its industry peers.
Industry RankSector Rank
Debt/Equity 1.09
Debt/FCF 9.03
Altman-Z 0.38
ROIC/WACC0.07
WACC7.61%
WBD Yearly LT Debt VS Equity VS FCFWBD Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 10B 20B 30B 40B

2.3 Liquidity

WBD has a Current Ratio of 0.89. This is a bad value and indicates that WBD is not financially healthy enough and could expect problems in meeting its short term obligations.
WBD's Current ratio of 0.89 is in line compared to the rest of the industry. WBD outperforms 50.00% of its industry peers.
A Quick Ratio of 0.89 indicates that WBD may have some problems paying its short term obligations.
WBD has a Quick ratio (0.89) which is in line with its industry peers.
Industry RankSector Rank
Current Ratio 0.89
Quick Ratio 0.89
WBD Yearly Current Assets VS Current LiabilitesWBD Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 5B 10B 15B

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4

3. Growth

3.1 Past

WBD shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 27.78%, which is quite impressive.
WBD shows a decrease in Revenue. In the last year, the revenue decreased by -4.84%.
WBD shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 28.68% yearly.
EPS 1Y (TTM)27.78%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%-25%
Revenue 1Y (TTM)-4.84%
Revenue growth 3Y47.75%
Revenue growth 5Y28.68%
Sales Q2Q%-2.5%

3.2 Future

The Earnings Per Share is expected to grow by 23.44% on average over the next years. This is a very strong growth
The Revenue is expected to grow by 0.69% on average over the next years.
EPS Next Y77.44%
EPS Next 2Y45.66%
EPS Next 3Y33.24%
EPS Next 5Y23.44%
Revenue Next Year-1.76%
Revenue Next 2Y-0.54%
Revenue Next 3Y0.2%
Revenue Next 5Y0.69%

3.3 Evolution

When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
WBD Yearly Revenue VS EstimatesWBD Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 10B 20B 30B 40B 50B
WBD Yearly EPS VS EstimatesWBD Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 0 2 -2 -4

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3

4. Valuation

4.1 Price/Earnings Ratio

WBD reported negative earnings for the last year, which makes the Price/Earnings Ratio negative.
Besides the negative Price/Earnings Ratio, also the Forward Price/Earnings Ratio is negative for WBD. No positive earnings are expected for the next year.
Industry RankSector Rank
PE N/A
Fwd PE N/A
WBD Price Earnings VS Forward Price EarningsWBD Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 0 20 -20

4.2 Price Multiples

WBD's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. WBD is cheaper than 93.06% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, WBD is valued cheaper than 98.61% of the companies in the same industry.
Industry RankSector Rank
P/FCF 4.39
EV/EBITDA 2.58
WBD Per share dataWBD EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 10 -10

4.3 Compensation for Growth

WBD's earnings are expected to grow with 33.24% in the coming years. This may justify a more expensive valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y45.66%
EPS Next 3Y33.24%

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0

5. Dividend

5.1 Amount

WBD does not give a dividend.
Industry RankSector Rank
Dividend Yield N/A

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WARNER BROS DISCOVERY INC

NASDAQ:WBD (4/16/2025, 8:00:02 PM)

Premarket: 7.91 -0.01 (-0.13%)

7.92

-0.33 (-4%)

Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryEntertainment
Earnings (Last)02-27 2025-02-27/bmo
Earnings (Next)05-08 2025-05-08/bmo
Inst Owners68.22%
Inst Owner Change0.01%
Ins Owners1.05%
Ins Owner Change2.21%
Market Cap19.44B
Analysts72.5
Price Target13.5 (70.45%)
Short Float %2.88%
Short Ratio1.91
Dividend
Industry RankSector Rank
Dividend Yield N/A
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-658.23%
Min EPS beat(2)-1474.18%
Max EPS beat(2)157.73%
EPS beat(4)1
Avg EPS beat(4)-360.29%
Min EPS beat(4)-1474.18%
Max EPS beat(4)157.73%
EPS beat(8)1
Avg EPS beat(8)-1374.61%
EPS beat(12)3
Avg EPS beat(12)-525.58%
EPS beat(16)4
Avg EPS beat(16)-403.48%
Revenue beat(2)0
Avg Revenue beat(2)-2.68%
Min Revenue beat(2)-2.77%
Max Revenue beat(2)-2.58%
Revenue beat(4)0
Avg Revenue beat(4)-3.37%
Min Revenue beat(4)-4.51%
Max Revenue beat(4)-2.58%
Revenue beat(8)0
Avg Revenue beat(8)-2.44%
Revenue beat(12)0
Avg Revenue beat(12)-8.68%
Revenue beat(16)2
Avg Revenue beat(16)-6.41%
PT rev (1m)2.24%
PT rev (3m)8.39%
EPS NQ rev (1m)-8.62%
EPS NQ rev (3m)-50.84%
EPS NY rev (1m)-22.64%
EPS NY rev (3m)-54.92%
Revenue NQ rev (1m)-0.76%
Revenue NQ rev (3m)-3.67%
Revenue NY rev (1m)-0.38%
Revenue NY rev (3m)-2.52%
Valuation
Industry RankSector Rank
PE N/A
Fwd PE N/A
P/S 0.49
P/FCF 4.39
P/OCF 3.62
P/B 0.57
P/tB N/A
EV/EBITDA 2.58
EPS(TTM)-0.91
EYN/A
EPS(NY)-0.21
Fwd EYN/A
FCF(TTM)1.8
FCFY22.77%
OCF(TTM)2.19
OCFY27.65%
SpS16.02
BVpS13.87
TBVpS-17.53
PEG (NY)N/A
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA -10.82%
ROE -33.23%
ROCE 0.65%
ROIC 0.51%
ROICexc 0.55%
ROICexgc 7.14%
OM 1.46%
PM (TTM) N/A
GM 43%
FCFM 11.26%
ROA(3y)-6.3%
ROA(5y)-2.79%
ROE(3y)-18.63%
ROE(5y)-8.08%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3Y-43.23%
ROICexcg growth 5Y-35.25%
ROICexc growth 3Y-54.46%
ROICexc growth 5Y-42.78%
OM growth 3Y-55.14%
OM growth 5Y-45.05%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-11.55%
GM growth 5Y-8.3%
F-Score4
Asset Turnover0.38
Health
Industry RankSector Rank
Debt/Equity 1.09
Debt/FCF 9.03
Debt/EBITDA 1.77
Cap/Depr 4.64%
Cap/Sales 2.41%
Interest Coverage 0.29
Cash Conversion 25.59%
Profit Quality N/A
Current Ratio 0.89
Quick Ratio 0.89
Altman-Z 0.38
F-Score4
WACC7.61%
ROIC/WACC0.07
Cap/Depr(3y)4.94%
Cap/Depr(5y)6.3%
Cap/Sales(3y)2.84%
Cap/Sales(5y)3.07%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)27.78%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%-25%
EPS Next Y77.44%
EPS Next 2Y45.66%
EPS Next 3Y33.24%
EPS Next 5Y23.44%
Revenue 1Y (TTM)-4.84%
Revenue growth 3Y47.75%
Revenue growth 5Y28.68%
Sales Q2Q%-2.5%
Revenue Next Year-1.76%
Revenue Next 2Y-0.54%
Revenue Next 3Y0.2%
Revenue Next 5Y0.69%
EBIT growth 1Y202.86%
EBIT growth 3Y-33.72%
EBIT growth 5Y-29.28%
EBIT Next Year204.29%
EBIT Next 3Y45.48%
EBIT Next 5Y26.07%
FCF growth 1Y-28.14%
FCF growth 3Y22.22%
FCF growth 5Y7.32%
OCF growth 1Y-28.11%
OCF growth 3Y24.31%
OCF growth 5Y9.6%