Warner Bros Discovery (NASDAQ:WBD) stock is on the rise Friday as investors react to new upgrades for the media company’s shares.
Wolfe Research starts off the upgrades as it bumps shares of WBD stock up to an “outperform” rating. Prior to that, the firm held a “peer perform” rating for WBD shares. For comparison, the analysts’ consensus rating for WBD stock is “moderate-buy.” That comes from 20 analysts’ ratings.
Wolfe Research analyst Peter Supino said the following in a note to clients obtained by MarketWatch:
“After a ’22 rife with negative surprises around the Warner-Discovery integration & TV advertising market, and after two rounds of forecast reductions, today’s expectations are attractive to underwrite.”
Another WBD Stock Upgrade
In addition to this, Wells Fargo also upgraded WBD stock. This pushed shares up to an “overweight” rating from an “equal weight” rating. It also includes an increased price target of $20 per share. That represents a potential 41.2% upside for the stock compared to Thursday’s closing price.
Wells Fargo analyst Steven Cahall made the following case in a note to clients, as per CNBC:
“We’ve stress tested the downside and expect WBD to succeed in deleveraging, and at a modest multiple that’s what should create the equity upside. We threw everything and the kitchen sink at a Downside Case scenario for WBD, and it still delevers to 3x by ’25E. We now have conviction in FCF to limit downside, while the stock has asymmetric upside.”
WBD stock is up roughly 1% as of Friday morning.
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On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.