KeyBanc Reiterates Overweight Rating on Warner Brothers Discovery (WBD)

KeyBanc analyst Brandon Nispel reiterated an Overweight rating and $14.00 price target on Warner Brothers Discovery (NASDAQ: WBD).

The analyst commented, "We are reiterating our OW rating on WBD and are maintaining our $14 PT. Results were mixed: revenue was -2.5% and lower than expect due to lower content and advertising, while adj. EBITDA was +10.2%, driven by beats in all segments. Going forward, while we understand the Linear headwinds, the loss of the NBA is a material positive to 2026. We continue to see DTC adj. EBITDA inflecting higher toward 20% margins (which is better than peers), the path to 150M DTC subs by 2026 appears reasonable, and Studios' performance should materially improve on better licensing, less write-offs of games, and a strong theatrical slate. Further, there is optionality on potentially spinning Linear nets with fundamentals in Studios and DTC improving, likely resulting in EBITDA growth in 2025/2026. We view the stock as undervalued, currently trading at ~6.6x vs. the historical 10-year avg. of ~8.0x."

For an analyst ratings summary and ratings history on Warner Brothers Discovery click here. For more ratings news on Warner Brothers Discovery click here.

Shares of Warner Brothers Discovery closed at $11.00 yesterday.

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