Warner Bros. Discovery (NASDAQ:WBD) Still Faces Challenges, Recover Possible, Timing Uncertain, BofA Says

Warner Bros. Discovery (WBD) continues to face challenges on multiple fronts as reflected by the recently concluded Q4, BofA Securities wrote in a note on Monday.

Warner Bros Discovery late last week reported a $0.16 per share net loss for the three months ended Dec. 31, improving from a loss of $0.86 a year-ago, but still lagging the analyst consensus by $0.10. Revenue declined to $10.28 billion, also trailing the $10.42 billion estimate.

The most recent quarter was riddled with challenges from a decline in the linear broadcast TV to advertisements and various strikes.

BofA analysts said a variety of factors may help the company improve, including a recovering ad market and if cord-cutting hits a plateau. Internal components like increased licensing of its content and an improved film slate, among others, could also act as tailwinds.

However, the company is not certain when this recovery will occur, the investment firm said. Warner Bros. Discovery did not provide a guidance for 2024, and BofA expects downward revisions.

BofA Securities trimmed its price objective for Warner Bros. Discovery to $14 from $17, but reiterated its buy rating.

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