Warner Bros. Discovery (NASDAQ:WBD) Shares Gap Down on Analyst Downgrade

Key Points

• Warner Bros. Discovery's shares experienced a significant decline after Cowen downgraded the stock from a buy rating to a hold rating, with prices opening at $18.78 down from a previous close of $19.46.
• Insider trading was notable, with Bruce Campbell selling 289,322 shares at an average price of $16.48, while Director Anton J. Levy purchased 250,000 shares at $10.90, indicating contrasting views on the company's prospects.
• Analysts mostly hold a neutral to hold stance on the stock, with a consensus target price of $13.25, despite expectations of a negative EPS of -4.33 for the current year.

Warner Bros. Discovery, Inc. (NASDAQ:WBD - Get Free Report)'s stock price gapped down before the market opened on Tuesday after Cowen downgraded the stock from a buy rating to a hold rating. The stock had previously closed at $19.46, but opened at $18.78. Warner Bros. Discovery shares last traded at $17.82, with a volume of 17,337,453 shares.

Other equities research analysts have also recently issued research reports about the company. Citigroup dropped their price objective on Warner Bros. Discovery from $15.00 to $14.00 and set a "buy" rating on the stock in a research note on Thursday, May 29th. UBS Group upped their price objective on Warner Bros. Discovery from $9.00 to $10.00 and gave the stock a "neutral" rating in a research note on Tuesday, July 8th. Guggenheim reiterated a "buy" rating on shares of Warner Bros. Discovery in a research note on Tuesday, June 10th. Argus upgraded Warner Bros. Discovery to a "hold" rating in a research note on Tuesday, May 27th. Finally, Wells Fargo & Company upped their price objective on Warner Bros. Discovery from $13.00 to $14.00 and gave the stock an "equal weight" rating in a research note on Thursday, September 11th. One equities research analyst has rated the stock with a Strong Buy rating, eight have given a Buy rating and thirteen have issued a Hold rating to the stock. According to data from MarketBeat.com, the company currently has an average rating of "Hold" and a consensus target price of $13.25.

Insider Buying and Selling at Warner Bros. Discovery

In other Warner Bros. Discovery news, insider Bruce Campbell sold 289,322 shares of the stock in a transaction on Thursday, September 11th. The stock was sold at an average price of $16.48, for a total transaction of $4,768,026.56. Following the transaction, the insider owned 402,464 shares in the company, valued at $6,632,606.72. This trade represents a 41.82% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available at this hyperlink. Also, Director Anton J. Levy acquired 250,000 shares of the stock in a transaction on Monday, August 11th. The shares were purchased at an average price of $10.90 per share, for a total transaction of $2,725,000.00. Following the transaction, the director directly owned 874,000 shares in the company, valued at approximately $9,526,600. This trade represents a 40.06% increase in their ownership of the stock. The disclosure for this purchase can be found here. 1.80% of the stock is owned by company insiders.

Institutional Trading of Warner Bros. Discovery

Several large investors have recently modified their holdings of WBD. Brighton Jones LLC grew its holdings in shares of Warner Bros. Discovery by 304.9% during the 4th quarter. Brighton Jones LLC now owns 68,950 shares of the company's stock worth $729,000 after purchasing an additional 51,920 shares in the last quarter. Ameriprise Financial Inc. grew its holdings in shares of Warner Bros. Discovery by 4.0% during the 4th quarter. Ameriprise Financial Inc. now owns 1,140,842 shares of the company's stock worth $12,061,000 after purchasing an additional 43,682 shares in the last quarter. NorthRock Partners LLC acquired a new stake in shares of Warner Bros. Discovery during the 4th quarter worth $111,000. Man Group plc grew its holdings in shares of Warner Bros. Discovery by 26.9% during the 4th quarter. Man Group plc now owns 47,049 shares of the company's stock worth $497,000 after purchasing an additional 9,969 shares in the last quarter. Finally, Quantinno Capital Management LP grew its holdings in shares of Warner Bros. Discovery by 43.5% during the 4th quarter. Quantinno Capital Management LP now owns 275,995 shares of the company's stock worth $2,917,000 after purchasing an additional 83,725 shares in the last quarter. 59.95% of the stock is owned by institutional investors and hedge funds.

Warner Bros. Discovery Trading Down 6.2%

The company has a market capitalization of $45.19 billion, a price-to-earnings ratio of 60.27, a price-to-earnings-growth ratio of 2.51 and a beta of 1.59. The company has a debt-to-equity ratio of 0.92, a quick ratio of 1.04 and a current ratio of 1.04. The firm has a fifty day moving average price of $12.57 and a 200-day moving average price of $10.71.

Warner Bros. Discovery (NASDAQ:WBD - Get Free Report) last released its quarterly earnings data on Thursday, August 7th. The company reported $0.63 earnings per share for the quarter, beating the consensus estimate of ($0.16) by $0.79. The business had revenue of $9.81 billion for the quarter, compared to analyst estimates of $9.73 billion. Warner Bros. Discovery had a return on equity of 2.14% and a net margin of 2.00%.Warner Bros. Discovery's revenue was up 1.0% compared to the same quarter last year. During the same period last year, the firm posted ($4.07) earnings per share. As a group, equities analysts anticipate that Warner Bros. Discovery, Inc. will post -4.33 EPS for the current year.

About Warner Bros. Discovery

Warner Bros. Discovery, Inc operates as a media and entertainment company worldwide. It operates through three segments: Studios, Network, and DTC. The Studios segment produces and releases feature films for initial exhibition in theaters; produces and licenses television programs to its networks and third parties and direct-to-consumer services; distributes films and television programs to various third parties and internal television; and offers streaming services and distribution through the home entertainment market, themed experience licensing, and interactive gaming.

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