Warner Bros. Discovery, Inc. (WBD) DCF Valuation
TGM's two-stage DCF values Warner Bros. Discovery, Inc. (WBD) between $14.33 and $28.17 depending on assumptions, with a base case of $20.86. Growth is taken from the company's own record (5-year revenue CAGR (FCF growth too volatile to use) (capped at 18%)), fading to 2.5% long-run; the discount rate (11.5%) reflects its beta.
What would today's price require?
$27.20 is justified only if free cash flow grows about +22.8% a year (fading to 2.5% long-run) at a 11.5% required return — slower than the company has actually grown.
| Scenario | FCF growth (fading to 2.5%) | Discount | Value / share |
|---|---|---|---|
| Conservative | 15.0%/yr | 12.5% | $14.33 |
| Base case | 18.0%/yr | 11.5% | $20.86 |
| Optimistic | 20.0%/yr | 10.5% | $28.17 |
| Analyst DCF (FMP) | independent reference — different model | $197.38 | |
Current Price
$27.20
Market-Implied Growth
+22.8%/yr
vs +28.1% 5Y actual
Model Scenario Range
$14.33 – $28.17
model output — not a price target
WBD DCF Fair Value Calculator
Edit the assumptions to see how they change the estimated fair value. Opens seeded with TGM's data-driven base case for WBD (growth from its own 5-year record, discount from its beta), so the sandbox starts where the scenarios above leave off. Illustrative model — not investment advice.
Base inputs: FCF $3.9B · 2.51B shares · net debt $28.0B
Estimated Fair Value
$41.20
+51.5% vs $27.20
Sensitivity — fair value by discount rate × terminal growth
How the estimated fair value shifts with the discount rate (WACC) and terminal growth, holding your 18.0%/yr FCF growth and 10-year horizon fixed. Green = above today's $27.20; red = below. Your current case is outlined.
| WACC ↓ / Terminal → | 1.50% | 2.00% | 2.50% | 3.00% | 3.50% |
|---|---|---|---|---|---|
| 9.5% | $54.05 | $57.03 | $60.43 | $64.36 | $68.93 |
| 10.5% | $44.98 | $47.13 | $49.55 | $52.29 | $55.43 |
| 11.5% | $37.83 | $39.42 | $41.20 | $43.18 | $45.41 |
| 12.5% | $32.07 | $33.28 | $34.61 | $36.09 | $37.73 |
| 13.5% | $27.35 | $28.29 | $29.31 | $30.43 | $31.66 |
About Warner Bros. Discovery, Inc.
Warner Bros. Discovery, Inc. operates as a prominent global media and entertainment conglomerate. Its operations are structured across three key divisions: Studios, Network, and Direct-to-Consumer (DTC). The Studios segment is responsible for the creation and theatrical release of feature films. It also develops and licenses television programming, serving both its internal network infrastructure and external partners, including direct-to-consumer platforms. Further, this segment manages the distribution of its film and television catalog to various third-party outlets and its proprietary television channels. Additionally, it encompasses streaming services, home entertainment distribution, licensing for themed attractions, and the creation of interactive games. The Network division oversees a comprehensive portfolio of television channels, both domestically and internationally. Its Direct-to-Consumer (DTC) segment focuses on delivering premium subscription television and streaming content directly to consumers. Beyond its operational structure, Warner Bros. Discovery commands an extensive intellectual property portfolio. This encompasses a vast array of iconic content, brands, and franchises spanning television, film, streaming, and gaming. Noteworthy examples include properties from the Warner Bros. Motion Picture Group and Television Group, DC, HBO, Max, Discovery Channel, CNN, HGTV, Food Network, TNT Sports, TBS, TLC, OWN, Warner Bros. Games, as well as beloved sagas like Batman, Superman, Wonder Woman, Harry Potter, Looney Tunes, Hanna-Barbera, Game of Thrones, and The Lord of the Rings. The company distributes its content through a multitude of channels, ranging from traditional linear, free-to-air, and broadcast television to authenticated digital applications, various digital distribution partnerships, content licensing agreements, and proprietary direct-to-consumer subscription offerings. Established in 2008, Warner Bros. Discovery, Inc. maintains its corporate headquarters in New York City.
- Sector
- Communication Services
- Industry
- Entertainment
- CEO
- David Zaslav