Buy tech sell-off, Wedbush’s Ives says: ’this is a 1996 moment, not 1999’
Warner Bros Discovery shares experienced a dramatic surge on September 12, 2025, climbing over 30% following reports that Paramount Skydance is preparing a majority-cash takeover bid for the media giant. The potential acquisition has sent shockwaves through the entertainment industry, with investors betting that the newly formed Paramount Skydance sees significant value in WBD’s assets that the market has failed to recognize. This marks one of WBD’s strongest trading days in years, as the stock jumped from around $16 to over $17 on heavy volume exceeding 40 million shares.
Potential Acquisition Could Reshape Streaming and Media Landscape
Paramount Skydance, fresh off its $8.4 billion merger with Paramount Global, has reportedly set its sights on acquiring Warner Bros Discovery’s entire operations, including HBO, CNN, DC Studios, and Warner Bros Pictures. Led by CEO David Ellison and backed by Oracle co-founder Larry Ellison, the company appears ready to make a majority-cash offer targeting WBD’s full business rather than just select divisions. This move comes despite WBD’s announced plans to split into separate entities by 2026, with Warner Bros handling studios and streaming while Discovery Global manages cable and networks.
The potential deal would create a media powerhouse capable of better competing with streaming giants like Netflix, Disney+, and Amazon Prime Video by combining HBO Max and Paramount+ subscriber bases. Industry analysts suggest that Paramount Skydance recognizes the transformation work WBD has completed over the past three years, turning loss-making segments into profitable operations while significantly reducing debt. With Warner Bros Discovery currently boasting a market cap of nearly $40 billion, more than double that of Paramount Skydance, the deal structure and financing mechanisms remain key questions for investors.
Market reaction has been swift and decisive, with WBD shares surging over 30% while Paramount’s stock jumped 15% on the news. The enthusiasm reflects investor belief that WBD has been undervalued by the market despite management’s successful operational improvements and debt reduction efforts that far exceeded guidance expectations.
WBD Rallies to Near Highs as Trading Volume Surges
The stock has shown remarkable momentum with a 52-week range of $7.25 to $18.02, indicating it has nearly reached new highs for the year. Trading volume has been exceptionally heavy at over 40 million shares, nearly double the average daily volume of 65 million shares, demonstrating intense investor interest in the potential acquisition scenario.
The company’s financial metrics reflect both challenges and improvements. Year-to-date performance has been particularly strong, with the stock gaining over 67% compared to the S&P 500’s 12% return, though longer-term performance remains mixed with a 5-year decline of 22.56%.
Analyst sentiment appears cautiously optimistic, with price targets ranging from a low of $10.00 to a high of $24.00, and an average target of $14.73. The current trading price above most analyst targets suggests the market is pricing in significant acquisition premium expectations. With earnings scheduled for November 6, 2025, investors will be closely watching for management commentary on the potential deal and the company’s strategic direction amid the takeover speculation.
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