WBD Stock - Terrible FIRST EARNINGS

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WBD Stock - Terrible FIRST EARNINGS - Still Value?

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Value Investing with Sven Carlin, Ph.D.

Күн бұрын

WBD had its earnings and those were terrible, but the positive is that the stock didn't fall that much which could be an indication of the bottom being close. Of course, if they deliver on the expectations.
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Пікірлер: 158

@jameslong7365 Жыл бұрын

Hi Sven I have been following your channel since 2017, and one word that i will use to describe my takeaway every time is "educational". Your previous video made me more interested in your research now than before since it is no longer a buy/hold/sell call that you felt forced to do for your research platform. Tbh, I never previously felt that you were calling on your viewers to buy or to sell stocks. You were and still are always focused on education, on risk and reward, and letting us decide for ourselves. Just want to affirm you for creating value in this messy world on KZfaqrs finance industry, and for making a difference. You, among very few others like Chuck Carnevale and Jimmy, have taught me value investing, and I will always appreciate your for that.

@loriero Жыл бұрын

Some people were using Sven's research platform as copy trading. They need to blame themselves.

@drstone1167 Жыл бұрын

✔️ Warner Bros. Discovery Has a Problem and it is the mess at Fake News 🛑 CNN they have yet to fix. Look at the daily Liberal Woke biased reporting they do daily. Could be why there Nielsen Ratings are pathetic and Ad Revenue is too. Remember 30 plus years ago when it was a real News Network. Shareholders at next shareholders stock meeting need to demand they fix the fake news reporting at CNN daily. WBD stock is still down 50% since the 2022 spinoff from AT&T. Excellence is never an accident. Failure is a choice.

@drstone1167 Жыл бұрын

✔️Sure looks like Warner Bros. Discovery Shareholders will suffer more losses because WBD Revenues were short of analysts' expectations at $11 billion, although streaming revenue topped forecasts at $2.45 billion as overall subscribers rose by 1.1 million to 96 million. Let’s not forget the liberal fake news clown 🤡 show is still going on at CNN daily as their Nielsen Ratings continue to decline. You have to either be brain dead or have a low IQ to believe any of the news they report daily. Hollywood movie producers continue to put out trash movies with nothing but sex, violence and destruction in them. Today there is not much family wholesome movie entertainment to go too. Remember companies “Going Woke” make shareholders go broke $$$. Warner Brothers Discovery stock chart for 1 years says it all.

@jhonnyfromme2109 Жыл бұрын

Interesting timing on your video, I finally got filled on WBD today. I guess the bad earnings helped. Thanks for the video.

@Value-Investing Жыл бұрын

thanks:-)

@DavidH_SIA Жыл бұрын

WBD should turn around!

@thatguyinthathat.s6969 Жыл бұрын

Been in this for a year now... sold half at $28. Held the other half, on average down a bit... but holding. HBO Discovery and Warner Brothers have brand recognition around the world. Once Zaslav gets things sorted out... WBD could dominate the market..

@Value-Investing Жыл бұрын

thanks for sharing!

@tripleal5 Жыл бұрын

If we consider their structuring cost this year it’s 2B, they should easily get 5B next year of FCF if they make 3B this year. If in additional they cut expenses, we should definitely see synergy savings. They also released their debt schedule, 1.5B for 2023, 4,2 for 2024 and about 10B for 2025. Since they will receive 1.2B from AT&T this quarter, they should be good to pay debt till 2024 and probably and perhaps another 4-6b for 2025… still 5B FCF for a 32B market cap sounds like a good deal

@DavidH_SIA Жыл бұрын

Agreed!

@cosminlupulescu167 Жыл бұрын

Thank you, Sven, for this realistic point of view.

@havrenne Жыл бұрын

Would be curious about your take on Porsche SE (more as a special situation, not a long term investment). The case is quite complex, keeping the value hidden and locked.

@Value-Investing Жыл бұрын

thanks for suggesting!

@TidusVen Жыл бұрын

Great Video Sven! I also believe WBD might perform well on the next couple of years. I think the debt levels are an issue, but I think management is doing a good job to tacke it. I remember checking AT&T 10k for Warner Bros cash-flow and it was about 2B$ in 2021, so I believe with some synergies WBD might reach 6B$... but I could be wrong in so many ways.

@Value-Investing Жыл бұрын

thanks for sharing - time will tell ...

@maxsterling9908 Жыл бұрын

WBD has more content than Netflix and Prime combined. I have options on WBD expiring in 2024. Michael Bury sold all of his holdings including WBD but that doesn't mean anything. Currently eight super investors own WBD in their funds including Seth Klarman who bought 18 million shares.

@DavidH_SIA Жыл бұрын

Yeah, so many superinvestor interest in this stock

@TheBooban Жыл бұрын

I am one of the T&T investors that dumped WB as well as T soon after. Be careful thinking this was irrationality. T investors are very passive and prudent and have had insight since the start of this fiasco. So most either did nothing, or dumped for a reason. Discovery stock was already bombing before all of this. HBO/WB just wasn’t turning out (enough) great entertainment. T with great cash flow could have given time for a turn around. But now they dumped this on Discovery, including the huge debt. So how they going to pay for all this new talent that can turn things around? Just because Discovery CEO is some kind of genius? Many have said that. He is just 1 old dude and his stock performance doesn’t bear this out. Its very cheap now, thats true. If it’s market cap approaches the estimated price of its library, now we’re talking about value investing. I don’t know what that is though.

@kal2352 Жыл бұрын

The debt ratio is very risky. I mean $54 billion in debt with an average of 4.3% interest mean $2 billion in payments just on interest alone. Also current EBITDA is 1 billion per quarter, how are they going to get to $15 billion?

@christopherfarrell8689 Жыл бұрын

Hi Sven, is it possible to get a quick video of all the links / websites that are useful for collecting information when evaluating a company? Many thanks

@Value-Investing Жыл бұрын

Great suggestion!

@vermasean Жыл бұрын

Thanks for your insightful videos! Love the investment and entertainment value of your channel. One of my favorite things is your lead in to hitting the like 👍 button! Always a favorite.

@Value-Investing Жыл бұрын

Glad you like them!

@DavidH_SIA Жыл бұрын

Agree haha

@linusjacobsson2419 Жыл бұрын

Valuable update. Thanks!

@abhisheksamanta1 5 ай бұрын

A followup on this?

@Value-Investing 5 ай бұрын

here it is, published last week: kzfaq.info/get/bejne/j7GnlbCeq7W1l4k.html

@dariocasabella2744 Жыл бұрын

Can you have a look at Adidas? You said you would if the price fall and it did it

@Garber1956 Жыл бұрын

The owner also said advertising revenue has been soft and starting a free streaming online TV service like Pluto TV, and eyes 2023 before numbers improve

@Value-Investing Жыл бұрын

thanks for sharing!

@chriscooper5173 Жыл бұрын

The correct term as 2 companies merge I believe is referred to as an acquisition I could be wrong though

@Value-Investing Жыл бұрын

it is M&A, but then how it sounds better for those promoting it

@pieromalutta8457 Жыл бұрын

Sempre ben druze Sven, grazie per il servizio

@Value-Investing Жыл бұрын

grazie!

@jeromevolckerpowell5080 Жыл бұрын

No moat. A purchase would be based on the hope of a turnaround. If they can turn the ship around good for them and everybody who was a believer. I would not touch it. If you calculate its aquirers multiple it is still more than 20 percent more expensive than google. So less quality and for now it is cheap for a reason.

@yourstruly5706 Жыл бұрын

I would say their moat is the IP they own, they've just not been able to capitalise on it as much as one would expect.

@gmoney546 Жыл бұрын

It is evident you don't know how to calculate Warner's acquirers multiple if you feel like it is more expensive than google.

@jeromevolckerpowell5080 Жыл бұрын

I do get a aquirers multiple of about 21.3 for wbd. Marketcap of 32.3 - cash of 3.9 + debt of 14.2 enterprise value of 42.6 divided by ebit of about 2 gives me a multiple of 21.3 would you agree with that calculation?

@jeromevolckerpowell5080 Жыл бұрын

@@gmoney546 and looking at google using GOOGL i do get. Mkt cap of 1446 - cash 139.6 + debt of 14.8 makes ev of 1321.2 divided by ebit of about 78 makes an aquirers multiple of 16.9. Where did i go wrong? If there is anything about my calculation that is wrong i would be glad if you can share your thoughts!

@Value-Investing Жыл бұрын

thanks for sharing!

@supaflydann Жыл бұрын

Peter Lynch said many spin offs can be great opportunities. Been buying in blocks, bought more today.

@mihu02 Жыл бұрын

My main hope is they plug the DC ip the right way and dont kill it.... fingers crossed :D

@anderson6379 Жыл бұрын

George Carlin snippet made my day 😂 😂 😂 Your humour is priceless

@fooleos Жыл бұрын

Sell Put options on it to potentially get it even cheaper than current price

@GordonGekko98 Жыл бұрын

I started buying at $23, average is now 18, if they get to 6 billion in free cashflow and a 15 PE this thing is worth $40/share

@Buffdawg99 Жыл бұрын

The only fault I see is that you’re not accounting for debt, as WBD is highly levered with net debt of approximately $50B. That amounts to an enterprise value of $140B based on free cash flow of $6B and a FCF-multiple of 15. If you penalize the company for its high debt levels, the intrinsic value per share is closer to $16.

@Value-Investing Жыл бұрын

thanks for sharing - let's see how it evolves!

@pennguino9137 Жыл бұрын

Croatia has a special memory. My son got SCUBA certified there in Pula. I have a tiny position in WBD. Thank you for the update!

@Value-Investing Жыл бұрын

:-)) Pula is coming I think on Friday in a video - watch that one!

@thewonderof06790 Жыл бұрын

I will pass. Times are changing. I watch more Swen than WBD presentations. That's from an old guys view. I might be wrong now, but not often in the past.

@drstone1167 Жыл бұрын

🎬 Hollywood produced good movies back in the 50s and 60s. Now all they mostly produce is trash and violence. 3. The Sound of Music (1965) by 20th Century Fox Estimated admissions: 157.2 million tickets Estimated accounting for inflation gross: $1.41 billion putting it in No. 6 spot of all times at box office. 6. Paramount movie in (1956) the 10 Commandments Accounting for inflation, earned the equivalence of $1.2 billion in today’s dollars, putting the epic movie starring Charlton Heston in the No. 6 spot of all time at the box office for adjusted revenue. 🆘 Remember quality, good entertainment sells tickets.

@Value-Investing Жыл бұрын

thanks for sharing!

@maxjames00077 Жыл бұрын

So the 7 bn FCF that analyst project is after they already paid for their interest on their 50 bn debt? which is 4,3% ish so 2 bn a year?

@hodoprime Жыл бұрын

We are in an advertising recession. I expect that to turn around in 2024 when governments/corporations ramp up ad spend for the presidential election.

@Value-Investing Жыл бұрын

is that such a big impact? shouldn't be!

@hodoprime Жыл бұрын

@@Value-Investing I live in California. It seemed like the state public service announcements were running about 50% of the commercials in 2020.

@Neon_Dre Жыл бұрын

"EXPECTING" is the first mistake... Just my opinion though....

@DavidH_SIA Жыл бұрын

I also think it will take time to fully turn around

@user-pf1mq5uh4q Жыл бұрын

Sven you should look at $PERI low multiple, very good growth, very good management

@Value-Investing Жыл бұрын

thanks for sharing!

@jannemyllyla1223 Жыл бұрын

I called this potential valuetrap in twitter. Twitter did not agree 🙂 It is not expensive, but I think there is a possibility of a bad scenario and losing money just due to questions about earnings power in bad recession and having to refinance debt after the recession earnings.

@Value-Investing Жыл бұрын

hahahaha - the value trap can be in the 'value' of the content - time will tell!

@jannemyllyla1223 Жыл бұрын

@@Value-Investing could be in content too, but there are some nice series and other content. One extra source of trouble would be if people started to do more what I typically do: have each subscription 1-2 months and switch.

@loolapalooza6429 Жыл бұрын

Why fellow investors if you don’t invest 🤷‍♂️😂?

@Value-Investing Жыл бұрын

:-))) I just lowered my long term taxation by 50%, I guess that is investing too!

@loolapalooza6429 Жыл бұрын

@@Value-Investing Ha! That’s a fantastic return! 🍀

@BaliBrit Жыл бұрын

I got them from the T split & didnt notice, down 62.8% Ill dump them if they ever go up! Thanks for the video

@Value-Investing Жыл бұрын

this is a perfect examples of inefficient markets!

@BaliBrit Жыл бұрын

@@Value-Investing I think it was me that was inefficient!

@berliozbetty5230 Жыл бұрын

3:30 is the term you are looking for "big bath"?

@Value-Investing Жыл бұрын

to throw away everything but the kitchen sink, to get a fresh start?

@DS-vx3wf Жыл бұрын

I will buy this share at $5 and some change...

@DavidePizzini Жыл бұрын

What di you think of competitor? For example paramount?

@Value-Investing Жыл бұрын

have to analyze!

@DavidH_SIA Жыл бұрын

good question

@giorgiomanca7495 Жыл бұрын

Hi Sven, still waiting for next earnings to increase your stake? What a steal at current prices

@Value-Investing Жыл бұрын

will check:-)

@wread1982 Жыл бұрын

VGT will smoke Warner Brothers

@Value-Investing Жыл бұрын

thanks for sharing!

@sarchmaster5779 Жыл бұрын

Thanks for the update Sven!

@Value-Investing Жыл бұрын

thanks!

@leestringer Жыл бұрын

"Overcompensate" is the word you're looking for. :)

@Value-Investing Жыл бұрын

:-)))

@thomaskismul8541 Жыл бұрын

Hi, Sven and thanks yet again for a great video discussing businesses! Is it possible to achieve checking your portfolio only once every quarter? And how would you recommend from your own experience to be able to reach this? I find myself checking it daily though I know it is counter-productive. Thanks!

@Value-Investing Жыл бұрын

simple, you have earnings and actually quarterly is too much, should be half a year or just yearly as Buffett does his conference - too much is simply just noise!

@frozenlkea6188 Жыл бұрын

I love the change in background

@Value-Investing Жыл бұрын

thanks!

@michaelpescatore4354 Жыл бұрын

Buy high sell low

@OldAssSax Жыл бұрын

So Sven, how big is your personal position in WBD? :P

@Value-Investing Жыл бұрын

I don't own any WBD - this is an educational portfolio to see how the spin-off/value thesis works!

@santoshragi Жыл бұрын

Here's a question to consider before buying in to the thesis of $30 billion market cap/$5 billion expected free cashflow. Is there a difference between 2 following companies? - Company A with market cap of $30 billion, expected free cash flow of $5 billion & NO DEBT - Company B with market cap of $30 billion, expected free cash flow of $5 billion & $53 billion of DEBT As we are aware, the free cash flow accounts for interest expense but not debt repayments.

@Value-Investing Жыл бұрын

free cash flow should be after interest expense - and yes, debt repayments don't count, so we will see how they work on it. Debt reduction all else equal is also value creation!

@fregger74 Жыл бұрын

did a deep dive on wbd and the only thing i dont like about the company is the management. it does look cheap, but with so many amazing stocks crashing i feel like there are just much better companies for good prices.

@hammockman9039 Жыл бұрын

CEO, management team, WBD's assets are why I have been adding shares. A lack of visibility makes WBD a speculation.

@Value-Investing Жыл бұрын

thanks for sharing!

@TheBooban Жыл бұрын

@@hammockman9039 the CEO and management team have been over seeing this stock collapse. So what is there to like?

@friedrichowl Жыл бұрын

Sven, are you aware that Baupost has international Holdings and more AUM than 7b? It is not 3%, definitely smaller.

@Value-Investing Жыл бұрын

yes, plus it has much more in other things, so even less!

@tylerbaisden1308 Жыл бұрын

Love WBD

@Value-Investing Жыл бұрын

:-)

@DavidH_SIA Жыл бұрын

me too!

@shadowninja6689 Жыл бұрын

I got some shares from the T spinoff, and I regret not instantly selling them off. There's no way I'd have faith in WBD to invest in them nowadays, their CEO seems determined to pursue the wrong strategy of ditching HBO Max in favor of the much smaller Discovery+ for pure ego reasons. And rising interest rates makes their big debt problem much worse. That said, WBD is such a small fraction of my portfolio that even if it 10Xed in value from here it would barely make a dent in my overall portfolio's ROI. I'll probably sell it the next time I want to take profits in something else to counter-act the tax liability with a loss.

@Alex1999_3 Жыл бұрын

How am I going to take any advice from someone that sold everything? 😂. Don’t get bamboozled guys..

@Value-Investing Жыл бұрын

hahaha

@sdavidleigh6642 Жыл бұрын

Yikes to Intangibles, Goodwill -$23 Billion. The company pays all this money and gets a name. Feels like walking on a tightrope, one bad management idea and goodwill is just flushed. Also this stock suffers from a lot of funds buying in. Do they all go to the same bar for lunch and compare notes- I think so. Also if all the hedge / pension funds etc have bought who is left to buy to push it up - overowned. It looks like a very competitive industry in which players will delivertably lose money for market share. I always like industries where they will compete by advertising not buy price. John Templeton was a great stock picker (Templeton Growth Fund) and his claim to fame was to sell out of Japan in 1989 right at the peak. He had bought in mid 1960- NIKKEI at 600 and peaked at 39 000. Peter Cundill learned his technique and was very successful. 'After they analysed everything they could about a company they closed their eyes and did what their guts were telling them'. I close my eyes on WBD and my guts are saying pass.

@Value-Investing Жыл бұрын

good point!

@jacobm7026 Жыл бұрын

The mindset of a suboptimal investor right here. I bet you haven't beaten the market in a while. LOL

@sdavidleigh6642 Жыл бұрын

@@jacobm7026 Suboptimal Investor- and you have? There is about a handful that can claim that title in the long haul my friend. Be kind and honest, thanks.

@jacobm7026 Жыл бұрын

@@sdavidleigh6642 About to be a 17 year 24% CAGR. Roughly flat on the year 2022. But it's poor investing logic that you're utilizing in your original comment that is making you a suboptimal investor. Not trying to be kind nor rude. Only honest. Thanks.

@sdavidleigh6642 Жыл бұрын

@@jacobm7026 Congratulations. You are the only one on the planet that has done that. It must be amazing to have accomplished what more than 7 billion others have not.

@odavis1364 Жыл бұрын

If Top Gun is any indication of what folks want in their movies than this company should do well going forward.

@Value-Investing Жыл бұрын

:-)) thanks for sharing!

@HenningYT Жыл бұрын

True but Top Gun has been produced by Paramount not WBD Discovery.

@TheBooban Жыл бұрын

@@HenningYT who owns paramount?

@mihu02 Жыл бұрын

@@TheBooban It's owned by National Amusements a private media/theater holding company. Paramount global or inc or whatever it is called now was the former viacomCBS....again alot of different merger back n forth history. Long story short nothing too do with discovery or warner bros/ warner media / WBD

@XMan-mi6gs Жыл бұрын

I sold it after the spin off because it was not paying a dividend and the streamingwar is in full swing. And I didn’t like or know all the content of all those streaming services. HBO is great but TLC… mwehh. I just wasn’t happy with the stock. Bought a other one with the profits.

@Value-Investing Жыл бұрын

Fair enough!

@davidwilson9976 Жыл бұрын

This is sniffing like Alibaba, every value investor is in this one......not falling for it.

@Value-Investing Жыл бұрын

thanks for sharing!

@PrintOnDemandWorld Жыл бұрын

Sven take a look at Western Union please. From a value prospective looks really promising at this price

@innocentiuslacrim2290 Жыл бұрын

Is their business model viable in the long run? It just seems like outdated and expensive cross border money transfers.

@Value-Investing Жыл бұрын

thanks for sharing, but I did look at it a long time ago, didn't like the no network effect!

@joelspicher590 Жыл бұрын

I would very much like if you could have a look at Straumann, I have a fair price at 170 CHF, trading currently under 100 CHF, seems very interesting to me but would love to have your point of view. I am a member so happy if you post on your research platform only. Thanks for all the great work you provide, I love your research !

@Value-Investing Жыл бұрын

I actually looked at it a while ago, it was too expensive and that proved right. But still a PE ratio of 32

@joelspicher590 Жыл бұрын

Thank you very much for your answer ! I very much enjoy reading your research on your platform.

@jchong416 Жыл бұрын

As much as I like wbd's value, I can't invest more money. I will only buy the infrastructure in the streaming space such as amzn, googl, MSFT and aapl. I am going to hold my spin off shares though

@Value-Investing Жыл бұрын

thanks for sharing!

@jc.1191 Жыл бұрын

At&t was without doubt holding a bunch of junk and lies on the books. I'm always suspicious of spinoffs these days, especially so soon after a merger. Johnson and Johnson is another one imo.

@Value-Investing Жыл бұрын

good points, thanks for sharing!

@pacocalabasa6605 Жыл бұрын

WBD seems like an okay company at a good price. Maybe that is what this YT portfolio is about. But if you wanted to own a streamer NFLX around $175 would have been a great company at a good price.

@DylanDominguez1 Жыл бұрын

NFLX will take longer to recover back to its peak. Large caps take longer to rally unless there is a repeat market manipulation from the fed. WBD is better suited to rally as its valuation is priced in favourably with its intrinsic value of the business imo.

@pacocalabasa6605 Жыл бұрын

@@DylanDominguez1 exactly - higher risk, higher (potential) reward. Is WBD value *now*, or on potential? I don't have an opinion as I'm not interested in streamers generally. The market went from a NFLX - Prime duopoly to practically no barriers to entry at all. It's like EVs. When the market structure is Tesla sells all the EVs and everyone else splits the gas sales it's amazing. Now Chinese companies started making perfectly good EVs and nobody will make any money. That's the idea of capitalism - excess profits get competed away.

@Value-Investing Жыл бұрын

thanks for sharing - all interesting companies - time will tell!

@DavidH_SIA Жыл бұрын

curious: why is NFLX better company than WBD?

@Dr.Dumpnpump Жыл бұрын

Why do you care? You don’t invest anyways Sven, you just pump stocks and hope someone buys your course where you teach people how to time the market!

@Value-Investing Жыл бұрын

well, I must be doing something good as you still care and comment - thanks!

@litrecords7099 Жыл бұрын

Might be a value at 5$, right now overpriced.

@Value-Investing Жыл бұрын

Thanks for sharing!

@HenningYT Жыл бұрын

If I would have to invest in this sector I would prefer Paramount Group (US69924R1086). But as I do not want to invest in Media & Entertainment I just keep watching KZfaq videos.

@Value-Investing Жыл бұрын

thanks for sharing!