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Investing.com - Benchmark has added Warner Brothers Discovery (NASDAQ:WBD), a prominent $27 billion entertainment powerhouse, to its Best Ideas List while maintaining its Buy rating and $18.00 price target on the stock. The company has shown impressive momentum with a 61% return over the past year. According to InvestingPro analysis, WBD appears undervalued at current levels, with strong financial health indicators.
The research firm highlighted the upcoming Superman reimagination under director James Gunn, scheduled for release on July 11, 2025, which it expects to achieve approximately $700 million in global box office revenue. Benchmark noted this level would likely be sufficient for the film to achieve profitability while demonstrating DC Studios’ continued vitality. With annual revenue of $38.3 billion and EBITDA of $7.6 billion, WBD has significant resources to support its content strategy.
Benchmark also pointed to other box office successes from Warner Brothers Discovery, including The Minecraft Movie, which complement the company’s leadership in TV production. The firm expressed particular optimism about HBO Max’s performance in the streaming market.
The positive outlook comes as Nielsen recently reported that total streaming across all platforms reached 44.8% of TV viewership in May 2025, marking its highest level ever and surpassing the combined 44.2% share held by broadcast (20.1%) and cable networks (24.1%).
According to the data cited by Benchmark, streaming usage has increased 71% over the past four years, while broadcast and cable networks have declined by 21% and 39% respectively, with broadcast showing better resilience than cable. Analyst targets for WBD range from $9 to $24, reflecting diverse views on the company’s streaming potential. Get deeper insights into WBD’s streaming strategy and financial outlook with InvestingPro’s comprehensive research report, which includes 12 additional key insights about the company’s future prospects.
In other recent news, Warner Bros. Discovery has announced the pricing terms for cash tender offers through its subsidiaries, including Discovery Communications and WarnerMedia Holdings, to purchase nearly all of their outstanding notes and debentures. The tender offers, which have seen high participation rates, will result in proration for several note series, with specific acceptance percentages outlined for different pools of notes. Additionally, Warner Bros. Discovery disclosed its intention to exercise the early settlement right for these offers, with the early settlement anticipated to occur on June 30, 2025, subject to certain conditions. The company has also provided an update on its ongoing cash tender offers, offering a list of frequently asked questions to clarify details for security holders.
Furthermore, Warner Bros. Discovery has signed new employment agreements with top executives as part of its strategic reorganization, aiming to separate its Streaming & Studios division from its Global Networks division. CEO David Zaslav and CFO Gunnar Wiedenfels have entered into new contracts to ensure leadership continuity through this transition. In another development, Fitch Ratings downgraded Warner Bros. Discovery to ’BB+’ from ’BBB-’ and placed the ratings on Watch Negative following the company’s announcement to separate into two entities. Fitch cited concerns over the company’s future credit profile and the expected increase in leverage post-separation. The downgrade reflects Fitch’s view that Warner Bros. Discovery will become smaller and less diversified, operating within a declining industry.
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