Benchmark Co. analyst Matthew Harrigan maintained a Buy rating on Warner Bros (WBD – Research Report) today and set a price target of $18.00.
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Matthew Harrigan has given his Buy rating due to a combination of factors that highlight Warner Bros. Discovery’s potential for growth and value. The company’s recent financial results, despite some challenges, show a promising trajectory with a significant gain in direct-to-consumer subscribers, surpassing competitors like Disney. This increase in subscribers is seen as a crucial element for future growth, alongside the company’s efforts in cost control.
Additionally, the potential spinoff of the Global Linear Networks business is under serious consideration, which could further enhance the company’s market valuation by focusing on its core Studio and Streaming businesses. The valuation models suggest a reasonable target price, supported by strong free cash flow yields and a strategic approach to content investment. Harrigan believes that the company’s current stock price undervalues its long-term potential, particularly with its strong intellectual property lineup and the possibility of maximizing the value of its network segment.
Harrigan covers the Communication Services sector, focusing on stocks such as Live Nation Entertainment, Warner Bros, and Charter Communications. According to TipRanks, Harrigan has an average return of -2.6% and a 50.82% success rate on recommended stocks.
In another report released today, Bank of America Securities also reiterated a Buy rating on the stock with a $14.00 price target.