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Warner Bros. Discovery (WBD) Gains But Lags Market: What You Should Know

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Warner Bros. Discovery (WBD - Free Report) closed the most recent trading day at $12.60, moving +0.32% from the previous trading session. This change lagged the S&P 500's 1.29% gain on the day. Elsewhere, the Dow gained 0.8%, while the tech-heavy Nasdaq added 10.96%.

Prior to today's trading, shares of the operator of cable TV channels such as TLC and Animal Planet had gained 15.34% over the past month. This has outpaced the Consumer Discretionary sector's gain of 4.17% and the S&P 500's loss of 0.23% in that time.

Wall Street will be looking for positivity from Warner Bros. Discovery as it approaches its next earnings report date. In that report, analysts expect Warner Bros. Discovery to post earnings of $0.14 per share. This would mark no growth from the year-ago period. Meanwhile, our latest consensus estimate is calling for revenue of $11.21 billion, up 251.69% from the prior-year quarter.

It is also important to note the recent changes to analyst estimates for Warner Bros. Discovery. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. Warner Bros. Discovery is currently sporting a Zacks Rank of #3 (Hold).

Digging into valuation, Warner Bros. Discovery currently has a Forward P/E ratio of 13.32. For comparison, its industry has an average Forward P/E of 15.4, which means Warner Bros. Discovery is trading at a discount to the group.

Meanwhile, WBD's PEG ratio is currently 1.31. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Broadcast Radio and Television industry currently had an average PEG ratio of 1.61 as of yesterday's close.

The Broadcast Radio and Television industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 196, which puts it in the bottom 23% 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.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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