Warner Brothers Discovery (WBD) PT Lowered to $16 at Deutsche Bank
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Deutsche Bank analyst Bryan Kraft lowered the price target on Warner Brothers Discovery (NASDAQ: WBD) to $16.00 (from $18.00) while maintaining a Buy rating.
The analyst comments "We are maintaining our Buy rating and lowering our PT to $16, from $18, driven by our negative estimate revisions following Warner's lower than expected 1Q results. Our consolidated EBITDA estimates decreased by about $400M (4%) in both 2024 and 2025, while our LFCF estimates decreased by about $100M and $300M, respectively, in 2024 and 2025. 2024 FCF wasn't as impacted due to 1Q FCF outperformance. We believe that over the course of 2024, it will become apparent that Warner is likely to grow EBITDA in 2025, leading to some level of positive multiple rerating. Our $16 PT implies a 10.7% 2025E UFCF yield and 6.6x 2025E EBITDA; vs an 11.8% 2024E UFCF yield and 5.9x 2024E EBITDA at the current stock price."