Netflix (NFLX) has disclosed a new risk, in the Corporate Activity and Growth category.
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The analyst notes that completion of the WBD transaction is uncertain, as it is subject to various governmental and regulatory approvals that may not be received on the expected timeline or at all. Failure to satisfy these conditions could delay or derail the deal and, in certain circumstances, obligate Netflix to pay a substantial $5.8 billion termination fee. In addition, regulators may condition their approval on divestitures, operational limitations, or other costly remedies affecting WBD’s streaming and studios businesses. Such measures could not only jeopardize or postpone closing but also materially weaken WBD’s operations and diminish the strategic and financial benefits Netflix expects from the transaction.
The average NFLX stock price target is $116.42, implying 35.18% upside potential.
To learn more about Netflix’s risk factors, click here.