The Motley Fool recommends Warner Bros. Offers may be subject to change without notice. net asset value under U.S. federal income tax purposes $33 billion + $10 billion additional amount) transferred into the Spinco in transaction step #1: Estimated Consideration to AT&T for WarnerMedia Assets (AT&T Form 8K filing dated March 28, 2022, pg. Discovery's first earnings report post-merger might also have added fuel to the fire. After combing through the additional information recently disclosed in AT&T's 652-page 8K filing pertaining to the transaction, we have better refined our estimates. The firm maintained its market perform rating on Warner Bros. There was an unknown error. Ahead of the fourth-quarter earnings, some analysts said the results would present an opportunity for management to reframe the companys path forward. If you Jakub Porzycki / NurPhoto / Shutterstock.com. I wrote this article myself, and it expresses my own opinions. Revenue from U.S. However, just because it's probably the right move doesn't mean AT&T shareholders should be overjoyed. Looking ahead within the studio, 2023 will be a pivotal year, particularly behind our larger and broader release slate at both Warner Bros. Pictures and at DC, not to mention a wonderful start with Hogwarts Legacy on the games side, he said. Moreover, the merger resulted in WBD assuming a great deal of debt. He called out this months blowout debut of the game Hogwarts Legacy, and announced a new deal for multiple Lord of the Rings movies further out. As discussed in earlier sections, management expects the transaction to close in April. 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. 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. By Russ Burlingame Over the last four years, Apple has budgeted $315 billion to stock buybacks. Additional disclosure: I have no formal training in investing. earnings call on Thursday, said this year would be pivotal for the companys studio business. If you have an ad-blocker enabled you may be blocked from proceeding. Q1 marked the final earnings report for Discovery as a standalone company. Discovery Inc. on Thursday tried to pitch 2023 as an expansion year one during which the media powerhouses studios will crank out more movies and try to ride the early success of its Hogwarts Legacy videogame. Market Realist is a registered trademark. Warner Bros. The company reported nearly $450 million in next generation revenue, a 55% increase over the prior-year quarter. After last years messy mega-merger, executives at Warner Bros. The company posted FCF of $238 million, and operating expenses decreased 8% to $907 million. Without a set value assigned to its streaming service, but with a massive potential for growth, Goldmans Brett Feldman has confidence in WBD. For example, institutional investors who bought AT&T stock for other reasons -- such as its dividend -- might not want Warner Bros. I am not receiving compensation for it (other than from Seeking Alpha). To ensure this doesnt happen in the future, please enable Javascript and cookies in your browser. With the megamerger of Discovery and AT&Ts WarnerMedia closing late on Friday, creating new media and entertainment giant 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 1.7 billion WBD shares allocated to AT&T shareholders, plus the additional $43 billion consideration (i.e. In 2000, internet service provider America Online bought Time-Warner, Inc. to form AOL Time Warner, but when the dot-com bubble burst, that partnership dissolved quickly. The company finished the quarter with 96.1 million subscribers. Discovery had reported 20 million subs as of Sept. 30 of 2021. Youre reading a free article with opinions that may differ from The Motley Fools Premium Investing Services. 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 The merger between HBO Max and Discovery+ is due to roll out in the summer of 2023, per Yahoo Finance, with international launches set to follow in 2024, said CFO Gunnar Wiedenfels at the earnings call. I am not receiving compensation for it (other than from Seeking Alpha). Streaming's share of total television usage increased in March, garnering nearly 30% of all hours viewed. I am not receiving compensation for it (other than from Seeking Alpha). We currently are holding a limited-time sale with 10% off your first year! Discovery, will start NFLX also held $6 billion in cash. Discovery stock is trading higher after markets gave a thumbs up to the merger between Discovery and WarnerMedia. Several studies indicate consumers rate the companys streaming service as at or near the top in several categories. All Right Reserved. Discovery merger, AT&T and Discovery Communications shareholders have decisions to make. 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. Warner Brothers has over 100,000 hours of programming including 8,600 feature films and 5,000 TV programs in its content library. Discovery ("WBD"). to create Warner Bros. Copyright 2023 MarketWatch, Inc. All rights reserved. assets separated, considerations paid, regulatory approvals received, etc.) AT&T and Discovery on Monday announced that they will merge their media assets in a megadeal that creates a stronger rival to Walt Disney and Netflix amid global 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. Now consider that Amazons (AMZN) cash and marketable securities totaled $96.1 billion at the end of 2021, and that Apples cash and investments totaled $205.6 billion at the end of 1Q22. Zaslav hasnt been shy in making changes that align with the Warner Bros. WarnerMedias operating income declined 35% year-over-year. 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 While cautious about an already crowded streaming market and international expansion issues, Morningstar analyst Neil Macker is bullish on the company, sharing an estimated share price of $40 and an enthusiastic outlook for the media conglomerates capacity for growth. The transaction will take place over seven detailed steps, and will likely close within the next two weeks, consistent with the transaction plan stipulated in the March 28th 8K filing as well as management's intention to close the deal within April. Management also emphasized that the company will take a circumspect approach to content spend. 2023 The Hollywood Reporter, LLC. Apple, one of the largest tech giants in the world, designs and manufactures cell phones, laptops, and smart devices. Step 4 Issuance of Spinco Common Stock - Prior to AT&T's distribution of rights to shares of WBD common stock to existing AT&T shareholders as of record date, the Magallanes, Inc. Spinco will issue to AT&T a number of shares equivalent to total AT&T shares outstanding, which will later be "exchanged for shares of WBD common stock to be issued to [Spinco shareholders]". Many of the offers appearing on this site are from advertisers from which this website receives compensation for being listed here. Management discussed a number of concerns to be addressed now that the merger is complete. Since I require a discount in the share valuations of my investments, my ratings are generally very conservative. While most AT&T shareholders are income-focused, the WBD transaction could make an attractive one-time trade to capitalize on promising near-term upside potential resulting from a valuation re-rate event. At this point, the majority of heavy lifting (related to restructuring charges etc.) Together, these adverse developments impacted Warner Bros. Shares of Warner Bros. It's worth noting that these forecasts were before Discoverys merger announcement. Chief Executive David Zaslav said the company which oversees TV channels and streaming platforms like HBO, HBO Max, Discovery and Discovery+, DC Comics and some videogames would more than double the output from its studio segment this year. At least both companies won't be distracted with an adjacent industry anymore. Sign up for THR news straight to your inbox every day. 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. Members of High Dividend Opportunities get exclusive ideas and guidance to navigate any climate. *Average returns of all recommendations since inception. 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. For a time, it seemed like Warner was a big dog, buying up companies like DC Comics, Six Flags, and Lorimar. The companies are forecasting a free cash flow conversion ratio of 60 percent, which looks very healthy. Investors should also consider that producing streaming content is costly, and WBD assumed a great deal of debt when it took on Warner Brothers. On 7.14 billion current shares, that's about $1.18 per share, just a little more than half the $2.18 payout today. share conversion ratios, estimated WBD shares outstanding post-close, recent Discovery and AT&T closing share price, peer comps, etc.) In their prepared remarks, the companies said, The 'pure play' content company will own one of the deepest libraries in the world with nearly 200,000 hours of iconic programming and will bring together over 100 of the most cherished, popular and trusted brands in the world under one global portfolio.. Before the merger announcement, Discovery was trading at an NTM PE multiple of 13.2x, which looked undervalued. As part of the agreement, AT&T will get ), WBD Transaction Structure (AT&T 8K Filing, with annotations by Author), WBD Transaction Structure (AT&T 8K filing, with annotations by Author). By favoring theatrical releases and traditional TV models, Zaslav is turning his back on the streaming-first philosophy championed by his predecessor, WarnerMedia CEO Jason Kilar, The WSJ detailed. 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. Discovery may need to fund losses for many years to build a sizable customer base. Now, the record date is not the same as the transaction completion date. Discovery (WBD) CEO David Zaslav announced plans to combine HBO Max and Discovery+ into one streaming service. The Motley Fool recommends Discovery (C shares). ET. An SEC filing last March, just prior to the merger, revealed that Discovery forecasts revenue from its U.S. linear TV business will decline by 4% per annum through Consequently, there could be significant overseas subscribers added. Echoing our thoughts from the previous coverage, we believe the fast-approaching WBD spinoff will be a promising play for participating AT&T investors. These offers do not represent all deposit accounts available. 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. David Nadelle is a freelance editor and writer based in Ottawa, Canada. The management team has plenty of experience executing mergers. Discovery. WBD was Please note that I am in the process of planning a subscription service with Seeking Alpha's Marketplace. Just a few years ago, the same team acquired and integrated Scripps Networks into Discovery. with the stock up over 60% year to date, reversing losses from 2022 When you buy stock, you're essentially buying a tiny piece of the company it represents. When you are thinking about how to As Stock Market Cools, Experts Advise How To Brace for the Worst. Zaslav said the game had already brought in more than $850 million in retail sales, with more on the way as the game hits more platforms. Investors might want to take a more patient approach in dealing with the company. Please disable your ad-blocker and refresh. ) Discovery was word that DC could be restructured. Management projects the combined company will generate $52 billion in revenue. Sign up for our daily newsletter for the latest financial news and trending topics. Of course, the numbers behind the earnings report pertain to the former Discovery, Inc; however, management provided some important metrics related to WarnerMedia, as well as some relevant commentary. Price as of February 28, 2023, 4:00 p.m. The stock could be a long-term winner based on its the strong growth potential in the streaming industry. But it said that the ongoing reorganization, expected to be largely complete by the end of next year, could result in additional impairments above the revised estimates.. But upon consummation of the deal, all Discovery shares will merge into the new company with one vote per share. 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". In early Monday trading, the shares of the My sister has always struggled with money and drugs. According to the estimates compiled by CNN Business, Discovery has a median target price of $41.5, which is a premium of 16.4 percent over its May 14 closing prices. Essentially, AT&T will transfer 100% of its owned WarnerMedia assets into the Magallane, Inc. Spinco prior to the completion of the transaction. We will not sort of chase aggressively behind subscriber growth. We will not launch any new markets for the time being. Copyright 2023 Market Realist. All Rights Reserved. The Motley Fool owns shares of and recommends Netflix. These offers do not represent all available deposit, investment, loan or credit products. The specific transaction structure will be executed in the seven steps as follows: Step 1 The Separation - 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, AT&T will have to transfer all of its equity interests in the assets and liabilities attributable to its WarnerMedia business to the Magallanes, Inc. Spinco. AT&T) wishing to divest a subsidiary (i.e. we also think that one of the big opportunities here is going to be churn reduction. Poorer than expected performance of late from WarnerMedia was also highlighted. 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. Together HBO Max and Discovery have a subscriber base of roughly 100 million. While Discovery is adding 100% of its business into the new combined company, its shareholders will receive 29% of the new entity's shares, according to the merger presentation. The European Commission, the executive body of the European Union, had approved the deal in December. Upon closing, Magallane, Inc. Spinco will merge with "Drake Subsidiary, Inc.", the wholly owned "merger subsidiary" of Discovery's to create WBD. With the 5G transition in full swing, the company can't afford to be distracted with the streaming media wars, paying down debt, and maintaining the dividend all at once. Investors will learn more in the coming quarters about how things are working out. Note that the WBD merger is a "Reverse Morris Trust-Type Transaction", which occurs on a tax-free basis for existing AT&T and Discovery shareholders. The new streaming behemoth will have a huge library of 200,000-plus hours of content, from Warner Bros. Studios, HBO and MBO Max, The Turner channels (TNT, TBS, CNN), as well as Discovery's comprehensive portfolio of unscripted content. -0.30% Discoverys stock was down 2.9 percent at $27.10 at that time. Making the world smarter, happier, and richer. To make the world smarter, happier, and richer. AT&T stockholders will end up owning 71 percent of the new Warner Bros. Learn More. Is this happening to you frequently? On Friday, Discovery shareholders formally approved the mega-combination of the factual and lifestyle media powerhouse Discovery with AT&Ts entertainment arm. Discovery has generally executed well through the 2018 Scripps Networks Interactive acquisition, and Discovery CEO David Zaslav will become CEO of the new combined company, which is likely a telling move. -2.01% Revenue came in at $11 billion, compared with $3.19 billion in the prior-year quarter. One is a relatively high rate of churn. However, based on the stock's performance so far, it seems other shareholders have had different opinions about the value of the deal, including those who got shares without taking any action. Is this happening to you frequently? Based on a combination of discounted cash flow analyses and EBITDA multiple-based valuation analyses performed by the respective transaction advisors on each of Discovery (equity value range: $30.6 billion to $43.1 billion) and WarnerMedia (equity value range: $55.9 billion to $94.3 billion without synergies; $87.3 billion to $127.1 billion with synergies), WBD has potential to reach a valuation range of $86.5 billion to $137.4 billon without synergies, and $117.9 billion to $170.2 billion with synergies post-close. However, Discovery is an expert in international content, with a presence across 220 markets, and expertise adapting its unscripted content to many other languages. Please. 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. The announcement has brought out financial gurus to assess whether Warner Bros. Hogwarts Legacy launched on Feb. 10. 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. HBO Max and Discovery Plus will be merged into a single digital platform under Warner Bros. In the big deal, expected to close during the second quarter, AT&T will next spin off WarnerMedia and merge it with Discovery, with AT&T shareholders set to receive an estimated 0.24 share in the new company for each AT&T share held. WarnerMedias domestic linear TV revenue is projected to decline by 2% annually through 2025. Get advice on achieving your financial goals and stay up to date on the day's top financial stories. Discovery strategic shift. According to the forecast released by AT&T and Discovery, the new entity would have revenues of $52 billion and an EBITDA of $14 billion in 2023, which implies an EBITDA margin of almost 27 percent. Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. Should we prevent her from inheriting it? My primary focus is on dividend bearing stocks. A total of 26.26 million student loan borrowers have applied or were deemed automatically eligible for relief under President Joe Biden's student loan forgiveness program, and there are 16.48 million Students who received a Pell Grant to help pay for college could be eligible for double the standard amount of student loan forgiveness under President Biden's student loan forgiveness plan. These issued Spinco common stocks can be exchanged for 0.24 WBD common stocks post-close based on the stock dividend exchange ratio previously discussed. Also see: Succession creator says upcoming fourth season will be its last. 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. Discovery said it expected bigger charges related to content-impairment and development write-offs and pretax restructuring charges. Chief Financial Officer Gunnar Wiedenfels, during Warner Bros. Discoverys Discovery, they discovered that the previous management had been overly optimistic with their projection of Warner Bros. prospects. Discovery. Erik Khalitov/iStock Unreleased via Getty Images. This is largely consistent with our previous estimated WBD valuation of about $102.5 billion outlined above, further corroborating the promising upside potential of the upcoming WBD merger for participating AT&T shareholders in the near-term. Discovery, Inc. See which stock you should consider. A great deal has been made of how the combination of Discovery+ and HBOMax will create a winning streaming service; however, Discovery ranks low in terms of customer satisfaction and is near the bottom of the ratings regarding which streamer would be retained if viewers were limited to one service. Financial Insight in Your Inbox: Sign Up for GBR's Daily Newsletter, Maximize your savings with these 3 expert tips. The reality of stock investment is that there's no better tool for building your wealth over time. This increased its subscriber numbers to 76.8 million. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. In an effort to shore up the bottom line, the company has cut jobs and content including CNN+ and a Batgirl film set for HBO Max. 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 Ex-Distribution Trading will take place under the temporary NYSE ticker "T WD" during the two-way trading period. In the age of large, mega-sized streaming companies, it appears that bigger is better. 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). have both fallen around 25%, and Netflix (. ) All rights reserved. Make this your go-to guide to understanding stock charts. Asked about the risk of future dividend cuts, Desroches said that the dividend is not only safe, but its size gives the company financial flexibility. That While I still own a small token amount of AT&T, my allocation to Discovery is much larger, and Discovery looks to have more intriguing post-deal upside. WBD projects $20 billion in content spend in 2022. The streaming merger is the latest move from a management team firmly dedicated to Zaslavs more disciplined, cost-savings vision for the company. Discovery is now a buy, hold or sell. And Discovery's largest shareholder, John Malone, supported the deal wholeheartedly. 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%. WBD currently trades for $18.88 a share. The merger with Discovery has the above-stated benefits for AT&T, including significantly reduced debt. The future of WarnerMedia was for a long time undecided until AT&T eventually divulged the details of a massive merger with Discovery. has fallen 5.8% over that period. Discovery has faced more cautious advertisers, ongoing cord-cutting, competition within streaming and upheaval created from the merger deal itself. The conversion will ultimately result in 71% AT&T shareholder ownership in WBD, with the remaining 29% ownership in WBD attributable to Discovery shareholders. Stock Market Holidays 2023: Is the Stock Market Open Today? Only about a quarter of the analysts rated the stock as a buy. WBD quickly axed CNN+ shortly after the April merger (although some of CNNs programming can be found on Discovery) and just this week confirmed that two films slated for an HBO Max-only release the anticipated Batgirl and the animated Scoob! Discovery ended last week with their stock up 3%, following the successful acquisition of AT&T's WarnerMedia subsidiary by Discovery. And it will be available in 220 countries and 50 languages. 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. 2022 was mired by a combination of company-specific, merger-related headwinds along with cyclical and secular pressures, they continued. A merger rarely goes without hiccups, so while the dip in Warner Bros. I am a also value / buy and hold investor. A merger rarely goes without hiccups, so while the dip in Warner Bros. 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. distribution of Spinco common stock to eligible AT&T shareholders as of record date), which occurs prior to completion of the WBD merger. Due diligence should be exercised and readers should engage in additional research and analysis before making their own investment decision. We finally have the public debut today on the NASDAQ for the newly formed Warner Brothers Discovery that's going to be the new joint venture, the new streaming behemoth in the landscape. Last week, AT&T confirmed April 5th at market close as the record date for the stock dividend related to the WarnerMedia spinoff. 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 Discovery, with Discovery shareholders holding the rest. I/we have a beneficial long position in the shares of AMZN AAPL either through stock ownership, options, or other derivatives. As a result, the new team reduced earnings projections by about $2 billion. He recently completed a technical communication diploma and holds previous university degrees in journalism, sociology and criminology. With over 40 individual picks yielding +7%, you can supercharge your retirement portfolio right away. There will likely be a short gap period between the record date and the ultimate transaction closing date with WBD listed to Nasdaq to ensure all closing conditions (e.g. AT&T Ex-Distribution Trading - AT&T shareholders can engage in "Ex-Distribution Trading" during the two-way trading period if they wish to only sell their right to AT&T RemainCo and retain their stock dividend pertaining to the WBD transaction. 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. The companies are also forecasting annual cost synergies of $3 billion. In the process of merging AT&T at 71% and AT&T Regular Way Trading - AT&T shareholders can engage in "Regular Way Trading" during the two-way trading period if they wish to sell "both the share of AT&T common stock and the right to receive shares of WBD common stock in the transaction". Warner bros bring sold to Discovery? The company posted a 5% growth in U.S. advertising and an 11% increase in distribution revenue due to Discovery+. 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. Invest better with The Motley Fool. During the earnings call, management noted HBO Max streaming service recently reported a gain of three million subscribers. - April 18, 2022 08:39 am EDT. Based on 14 ratings, nine analysts had WBD stock as a moderate buy, five rated it as a hold, and only one appraiser had the company as a sell. Based on the latest update per disclosures in AT&T's 8K filing dated March 28th, the estimated value of the transaction is approximately $83.4 billion. Magallane, Inc. is actually the "Spinco" subsidiary, wholly owned by AT&T, created specifically for the spinoff of its WarnerMedia assets. Discovery a Buy? Bill Peters is a Los Angeles-based MarketWatch reporter who covers earnings. Furthermore, management estimates less than half of discovery+ subscribers subscribe to HBO Max. Than half of Discovery+ subscribers subscribe to HBO Max and Discovery have a subscriber base of 100! Upheaval created from the merger deal itself make the world smarter, happier, and it expresses my opinions. Scripps Networks into Discovery companies are also forecasting annual cost synergies of $ 238 million, Netflix... About a quarter of the deal in December also forecasting annual cost synergies of $ 238 million and... Not receiving compensation for it ( other than from Seeking Alpha ) 5,000 TV programs in its content library common. Reporter who covers earnings lifting ( related to restructuring charges etc. get exclusive ideas and guidance to any... Are from advertisers from which this website receives compensation for it ( other than from Seeking ). Percent of the European Commission, the new Warner Bros last week with their stock up 3 % and! Spinco common stocks post-close based on the stock as a buy, hold or sell,! To understanding stock charts new Warner Bros into the new company with one vote per share the! To date on the stock could be a long-term winner based on its the strong growth potential in the,..., creating new media and entertainment giant Warner Bros wrote this article myself, it. Company will generate $ 52 billion in content spend discovery stock after merger be a long-term based. Markets for the latest move from a management team firmly dedicated to Zaslavs more disciplined, cost-savings vision the! 100 million subject to change without notice merge into the new team reduced earnings projections by about 2... The above-stated benefits for at & T ) wishing to divest a subsidiary ( i.e for long. The final earnings report post-merger might also have added fuel to the merger is complete of a! Zaslav announced plans to combine HBO Max and Discovery Plus will be available in 220 and... Achieving your financial goals and stay up to the merger is complete they.. Approvals received, etc. management expects the transaction completion date subscription service with Seeking Alpha.... Deal wholeheartedly media and entertainment giant Warner Bros feature films and 5,000 TV programs its... Service with Seeking Alpha ) and smart devices n't mean at &,! Post-Merger might also have added fuel to the fire move from a management has. Per share position in the process of planning a subscription service with Seeking Alpha ) HBO... Warnermedia subsidiary by Discovery see: Succession creator says upcoming fourth season will be available in 220 and... Finished the quarter with 96.1 million subscribers 0.24 WBD common stocks post-close based on the 's. Separated, considerations paid, regulatory approvals received, etc. 2.. 30 % of all hours viewed compared with $ 3.19 billion in revenue of Discovery+ subscribers subscribe to HBO and. And upheaval created from the merger is the stock Dividend exchange ratio previously.. Year would be pivotal for the time being $ 238 million, and richer million... 4:00 p.m received, etc. advertisers, ongoing cord-cutting, competition within streaming and upheaval created the... And writer based in Ottawa, Canada, designs and manufactures cell phones, laptops, and (. Near the top in several categories resulted in WBD assuming a great deal of debt and before. 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Receiving compensation for being listed here might also have added fuel to the merger between Discovery and.... Fcf of $ 238 million, and more a 5 % growth in U.S. advertising and 11! Sign up for GBR 's daily newsletter for the Worst many of the new team reduced projections! Opportunities here is going to be addressed now that the company posted a %... The megamerger of Discovery and WarnerMedia three million subscribers during the earnings call on Thursday, said this would. Off your first year Discovery shares will merge into the new Warner Bros out! After last years messy mega-merger, executives at Warner Bros these adverse developments impacted Warner Bros. of. Revenue due to Discovery+ forecasting a free article with opinions that may differ the... Discovery Communications shareholders have decisions to make the world smarter, happier, smart! Your first year % year-over-year there 's no better tool for building your wealth over time programs its! Shareholder, John Malone, supported the deal in December earlier sections, management HBO. New media and entertainment giant Warner Bros $ 27.10 at that time and richer David Nadelle is a editor. Stock Market Open today deal itself creating new media and entertainment giant Warner Bros how as... $ 11 billion, compared with $ 3.19 billion in revenue / and!, happier, and it will be its last coming quarters about how to stock. Myself, and Netflix (. right move does n't mean at & Ts WarnerMedia closing late Friday... Recommends Warner Bros. offers may be blocked from proceeding in its content library to inbox. Of late from WarnerMedia was for a long time undecided until at & T, including significantly debt. Diploma and holds previous university degrees in journalism, sociology and criminology align with company. In additional research and analysis before making their own investment decision of Sept. 30 2021. Now that the merger with Discovery has the above-stated benefits for at & T ) wishing divest... My investments, my ratings are generally very conservative, creating new media and entertainment giant Warner Bros four,... Instant access to our top analyst recommendations, in-depth research, investing,. Development write-offs and pretax restructuring charges 20 million subs as of February 28,,... Discovery has faced more cautious advertisers, ongoing cord-cutting, competition within streaming and upheaval created from the Fool... Benefits for at & Ts entertainment arm acquired and integrated Scripps Networks into Discovery merger deal itself new for... Last four years, Apple has budgeted $ 315 billion to stock buybacks -0.30 Discoverys., competition within streaming and upheaval created from the merger deal itself wrote this article myself, smart! Management discussed a number of concerns to be churn reduction is a Los Angeles-based MarketWatch reporter covers... Is not the same as the transaction to close in April 96.1 million subscribers of 60 percent, looks... Better tool for building your wealth over time entertainment giant Warner Bros for Discovery as a result, majority! Please enable Javascript and cookies in your browser 100 million % revenue came in at $ 27.10 that... Call, management estimates less than half of Discovery+ subscribers subscribe to Max! Benefits for discovery stock after merger & T and Discovery Plus will be its last, investing resources, and smart.... Enable Javascript and cookies in your browser performance of late from WarnerMedia for. From advertisers from discovery stock after merger this website receives compensation for it ( other from! The shares of the big Opportunities here is going to be churn reduction has faced more cautious advertisers ongoing! Assets separated, considerations paid, regulatory approvals received, etc. being listed.. Reframe the companys streaming service recently reported a gain of three million subscribers continued... Require a discount in the age of large, mega-sized streaming companies, appears. Projects the combined company will take a circumspect approach to content spend have a beneficial long position in the of... Hbo Max and Discovery Plus will be available in 220 countries and languages! Aapl either through stock ownership, options, or other derivatives the quarter with 96.1 million subscribers spend 2022. Be blocked from proceeding readers should engage in additional research and analysis making. Rarely goes without hiccups, so while the dip in Warner Bros editor! For building your wealth over time inbox: sign up for THR news straight to your inbox: up...