7 Stock Price Predictions That Are Actually Worth Listening To

Warner Bros. Discovery (WBD)

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Warner Bros. Discovery (NASDAQ:WBD) lost 16.6% on August 5, 2022, after posting second-quarter results. In the second quarter, WBD posted a GAAP EPS of -$1.50. Revenue rose by 221.2% year over year to $9.83 billion.

The company bundled several write-downs. Amortization of intangibles costs $2.004 billion. Restructuring and other charges added to $1.033 billion in losses. And transaction and integration expenses related to separating from AT&T (NYSE:T) were $983 million.

WBD has an urgency to cut costs. Its net leverage is 5.0 times. Its gross debt of $53.0 billion could cost more to service in the future. The firm will have repaid $6 billion in debt by the end of August 2022.

It implemented cost initiatives that save it $1 billion in run rate synergy over the next 12 months. Furthermore, it will have at least another $2 billion saved in its cost synergy plan.

Importantly, WBD has long-term debt financing. The average maturity is over 14 years. The average interest rate is 4.3%. Most debt is at a fixed rate. The Federal Reserve’s aggressive interest rate hikes will not have an impact on WBD’s interest on the debt.

On the date of publication, Chris Lau did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

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