Traders Purchase High Volume of Put Options on Warner Bros. Discovery (NASDAQ:WBD)

Warner Bros. Discovery, Inc. (NASDAQ:WBD) was the target of unusually large options trading activity on Friday. Investors bought 232,659 put options on the company. This represents an increase of 71% compared to the average daily volume of 135,877 put options.

Insider Activity

In related news, CAO Lori C. Locke sold 4,122 shares of the stock in a transaction that occurred on Wednesday, December 10th. The shares were sold at an average price of $28.92, for a total transaction of $119,208.24. Following the completion of the sale, the chief accounting officer owned 100,962 shares of the company’s stock, valued at $2,919,821.04. This represents a 3.92% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available at this link. Also, CFO Gunnar Wiedenfels sold 242,994 shares of the firm’s stock in a transaction that occurred on Wednesday, December 10th. The shares were sold at an average price of $29.50, for a total transaction of $7,168,323.00. Following the completion of the sale, the chief financial officer owned 918,940 shares of the company’s stock, valued at approximately $27,108,730. This trade represents a 20.91% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Over the last three months, insiders have sold 257,116 shares of company stock valued at $7,546,331. Insiders own 1.90% of the company’s stock.

Institutional Investors Weigh In On Warner Bros. Discovery

Hedge funds have recently added to or reduced their stakes in the business. Vanguard Group Inc. lifted its holdings in shares of Warner Bros. Discovery by 0.7% in the 4th quarter. Vanguard Group Inc. now owns 283,180,433 shares of the company’s stock valued at $8,161,260,000 after buying an additional 1,966,278 shares during the period. Geode Capital Management LLC raised its position in Warner Bros. Discovery by 1.6% during the fourth quarter. Geode Capital Management LLC now owns 66,597,575 shares of the company’s stock valued at $1,912,634,000 after acquiring an additional 1,028,346 shares in the last quarter. Invesco Ltd. raised its position in Warner Bros. Discovery by 2.8% during the second quarter. Invesco Ltd. now owns 44,574,492 shares of the company’s stock valued at $510,824,000 after acquiring an additional 1,233,195 shares in the last quarter. Norges Bank acquired a new position in Warner Bros. Discovery in the fourth quarter valued at approximately $1,123,807,000. Finally, Jericho Capital Asset Management L.P. boosted its position in Warner Bros. Discovery by 108.9% in the 3rd quarter. Jericho Capital Asset Management L.P. now owns 35,095,390 shares of the company’s stock worth $685,413,000 after purchasing an additional 18,291,865 shares in the last quarter. 59.95% of the stock is owned by hedge funds and other institutional investors.

Analyst Upgrades and Downgrades

Several analysts have recently commented on WBD shares. TD Cowen increased their price objective on Warner Bros. Discovery from $22.00 to $26.00 and gave the company a “hold” rating in a report on Friday. Benchmark reaffirmed a “hold” rating on shares of Warner Bros. Discovery in a research report on Friday. The Goldman Sachs Group raised their price target on Warner Bros. Discovery from $13.00 to $14.75 and gave the stock a “buy” rating in a report on Friday, November 7th. Rothschild & Co Redburn set a $31.00 price target on Warner Bros. Discovery and gave the stock a “neutral” rating in a research note on Tuesday, February 17th. Finally, Sanford C. Bernstein increased their price objective on shares of Warner Bros. Discovery from $23.50 to $27.75 and gave the company a “market perform” rating in a research report on Tuesday. One research analyst has rated the stock with a Strong Buy rating, six have given a Buy rating, sixteen have given a Hold rating and one has issued a Sell rating to the stock. According to MarketBeat.com, the company presently has an average rating of “Hold” and an average price target of $25.39.

Warner Bros. Discovery News Roundup

Here are the key news stories impacting Warner Bros. Discovery this week:

• Positive Sentiment: Paramount’s acquisition agreement announced — a $31-per-share cash deal values WBD at roughly $110 billion and is now a formal merger agreement, creating a clear path to a cash exit for shareholders. PR Newswire
• Positive Sentiment: Netflix exits the bidding — Netflix declined to raise its offer after Paramount’s $31 bid was declared superior, reducing takeover uncertainty and making a Paramount close more likely. Reuters
• Positive Sentiment: EU approval expected to be manageable — sources tell Reuters the deal is likely to clear EU antitrust scrutiny with only minor divestments if required, lowering one regulatory hurdle. Reuters
• Neutral Sentiment: Analyst reactions mixed — several firms updated ratings/targets (TD Cowen raised its PT to $26 but kept a hold; Deutsche Bank moved to hold with a $31 PT), reflecting divided views on deal certainty and standalone fundamentals. MarketScreener (TD Cowen) MarketScreener (Deutsche Bank)
• Negative Sentiment: Q4 results disappointed — WBD posted a loss per share and revenue declined ~6% year/year, missing EPS expectations and underscoring legacy TV/studio weakness despite streaming growth. That weak print amplifies uncertainty around valuation and growth prospects. WBD press release / earnings
• Negative Sentiment: Employee and synergy risk — CNBC reports WBD staff fear layoffs if Paramount pursues roughly $6B of cost synergies; job cuts and integration execution could create operational disruption and headline risk. CNBC
• Negative Sentiment: Political/regulatory friction remains — California and other political actors could still slow the deal; state-level opposition and broader antitrust scrutiny remain possible roadblocks. Reuters
• Negative Sentiment: Options and sentiment signal volatility — today saw an unusually large spike in put option volume, indicating elevated hedging/speculative bearish positioning even as a cash deal price anchors the stock.

Warner Bros. Discovery Trading Down 2.2%

Warner Bros. Discovery stock opened at $28.17 on Friday. The stock has a 50-day moving average price of $28.37 and a 200 day moving average price of $22.66. The company has a market capitalization of $69.80 billion, a price-to-earnings ratio of 97.14 and a beta of 1.64. Warner Bros. Discovery has a 52 week low of $7.52 and a 52 week high of $30.00. The company has a quick ratio of 1.07, a current ratio of 1.07 and a debt-to-equity ratio of 0.90.

Warner Bros. Discovery (NASDAQ:WBD) last issued its quarterly earnings results on Thursday, February 26th. The company reported ($0.10) earnings per share for the quarter, missing the consensus estimate of $0.09 by ($0.19). Warner Bros. Discovery had a return on equity of 1.99% and a net margin of 1.95%.The business had revenue of $9.46 billion during the quarter, compared to analyst estimates of $9.33 billion. During the same quarter last year, the company posted ($0.20) EPS. Warner Bros. Discovery’s quarterly revenue was down 5.7% compared to the same quarter last year. Sell-side analysts anticipate that Warner Bros. Discovery will post -4.33 EPS for the current year.

Warner Bros. Discovery Company Profile

Warner Bros. Discovery (NASDAQ: WBD) is a global media and entertainment company formed when WarnerMedia and Discovery, Inc combined their businesses in 2022. Headquartered in New York City, the company assembles a broad portfolio of film and television production, linear and cable networks, streaming services and consumer distribution operations. Its assets span well-known studio brands, premium scripted and unscripted programming, news and factual entertainment, and licensed franchise properties.

The company’s core activities include film and television production and distribution through units such as Warner Bros.