Warner Bros. Discovery’s (WBD) senior management is exploring restructuring options amid a decline in the company’s stock price. While the possibility of a breakup was initially considered, the complexities associated with this move led executives to prioritize other strategies, including the sale of assets, the Financial Times reported. Over the past year, WBD stock has been down about 46%.
Breakup Plan Shelved
In July, WBD was reportedly considering spinning off the Warner Bros. movie studio and the Max streaming service into a separate company.
However, operational and legal challenges proved to be major obstacles to advancing this plan.
Alternative Restructuring Plans
WBD is now focusing on divesting smaller assets. The company is exploring the sale of its subsidiary, TVN, a television broadcaster in Poland. Also, Warner Bros. is mulling over selling a stake in its video game business.
In the meantime, WBD has announced layoffs as part of its cost-reduction efforts.
Is WBD a Good Buy?
Warner Bros. has a Moderate Buy consensus rating on TipRanks based on 10 Buy, six Hold, and one Sell recommendations. The analysts’ average price target on WBD stock is $12.50, implying a 58.63% upside potential from current levels.
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