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Warner Bros. Discovery (WBD) Dips More Than Broader Markets: What You Should Know

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Warner Bros. Discovery (WBD - Free Report) closed the most recent trading day at $14.43, moving -1.57% from the previous trading session. This change lagged the S&P 500's daily loss of 1.15%. Elsewhere, the Dow lost 0.71%, while the tech-heavy Nasdaq lost 0.13%.

Coming into today, shares of the operator of cable TV channels such as TLC and Animal Planet had gained 4.12% in the past month. In that same time, the Consumer Discretionary sector gained 2.58%, while the S&P 500 gained 1.44%.

Wall Street will be looking for positivity from Warner Bros. Discovery as it approaches its next earnings report date. The company is expected to report EPS of $0.03, down 96.39% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $11.6 billion, up 278.67% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $1.52 per share and revenue of $34.31 billion, which would represent changes of -5.59% and +181.42%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for Warner Bros. Discovery. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.53% higher. Warner Bros. Discovery is holding a Zacks Rank of #3 (Hold) right now.

Digging into valuation, Warner Bros. Discovery currently has a Forward P/E ratio of 9.67. For comparison, its industry has an average Forward P/E of 8.81, which means Warner Bros. Discovery is trading at a premium to the group.

Also, we should mention that WBD has a PEG ratio of 1.19. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Broadcast Radio and Television stocks are, on average, holding a PEG ratio of 1.19 based on yesterday's closing prices.

The Broadcast Radio and Television industry is part of the Consumer Discretionary sector. This group has a Zacks Industry Rank of 165, putting it in the bottom 35% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow WBD in the coming trading sessions, be sure to utilize Zacks.com.


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