Analyst Slashes Warner Bros. Stock Forecast, Says Valuation Is ’Ahead of Fundamentals’

Wall Street wakes up to reality check as analyst takes axe to media giant's projections.

The Numbers Don't Lie

Another day, another valuation fantasy meets spreadsheet reality. Warner Bros. discovers what crypto traders learned years ago—eventually, the math catches up with the hype. The analyst cut doesn't pull punches, highlighting the growing gap between stock price and actual performance metrics.

Fundamentals Strike Back

Traditional finance's favorite game—pumping valuations beyond sustainable levels—faces another credibility test. While crypto markets price in real-time innovation, legacy stocks keep playing catch-up with their own inflated expectations. The 'ahead of fundamentals' diagnosis sounds suspiciously familiar to anyone who's watched TradFi cycles repeat.

Another reminder that sometimes the most valuable asset isn't on the balance sheet—it's transparency.

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Takeover Hype Meets Analyst Doubt

KeyBanc analyst Brandon Nispel cut Warner Bros. to Sector Weight from Overweight, pointing to the risks around a rumored Paramount Skydance bid. Shares were down 1.7% to $19.45 in premarket trading.

“With the reports on a potential takeover, we feel the stock’s valuation has gotten ahead of the fundamentals,” Nispel wrote. “We have no way of knowing if a deal will ultimately materialize.”

He also warned that Warner Bros. may be fishing for a bidding war that could collapse altogether. CEO David Zaslav has been seeking an offer around $40 a share, according to reports, but that figure looks increasingly ambitious as skepticism grows.

Momentum May Not Last

The downgrade follows a similar MOVE earlier this month by TD Cowen’s Doug Creutz, who said Warner Bros. was beginning to look overvalued after its September run. Both cautions suggest that without a firm deal, investors may soon find themselves holding a stock priced for perfection.

Is Warner Bros. Stock a Good Buy?

Warner Bros. Discovery currently carries a Moderate Buy consensus based on 13 analyst ratings in the past 3 months. That includes four Buys, nine Holds, and zero Sell ratings. The average 12-month WBD price target sits at $14.55, implying a 26.44% downside from the last price.