Billionaires Are Betting on This Overlooked Stock. Should You Buy?

Billionaires Are Betting on This Overlooked Stock. Should You Buy?

Vandita Jadeja

Mon, August 17, 2026 at 3:30 PM GMT+3 5 min read

Quick Read

• Daniel Loeb's Third Point bought 20 million WBD shares worth $533 million, backing 24/7 Wall St.'s $32 BUY target implying 14% upside.

• WBD trades at just 7x EV/EBITDA versus Netflix's P/E of 30 and Disney's 15, making it look deeply discounted against streaming peers.

• The most widely read finance newsletter on Substack isn't published by a bank, it's Doomberg, where 383,000+ readers get the energy and macro analysis the mainstream press misses. 24/7 Wall St. readers save 17% on their first year here.

Warner Bros. Discovery (NASDAQ:WBD) has become one of the most talked-about setups in media, backed by billionaire investor activity. Third Point disclosed a 20 million-share WBD position worth about $533 million in Q2 2026, making it Daniel Loeb's largest new disclosed position, funded by exits from NVIDIA and Broadcom.

Our 24/7 Wall St. price target for WBD is $31.88, implying 13.89% upside from $27.99. Our recommendation is buy at moderate confidence.

24/7 Wall St. Price Target Summary

A Stock the Market Keeps Underreacting To

WBD is up 137.61% over the last year but only 2.64% over one month and -2.88% year to date, sitting just below its $30 52-week high.

Q2 2026 revenue of $8.72 billion missed by 5.39%, but GAAP EPS of $0.06 beat the -$0.10 consensus by 158.94%. Operating income jumped 228.11% year over year.

Streaming revenue crossed $3 billion for the first time with adjusted EBITDA of $512 million, up 63% ex-FX. The Paramount Skydance merger remains on hold with a June 1, 2027 outside date, providing optionality beyond operating results.

The Case for $33 and Higher

Our bull scenario points to $33.28, an 18.9% return. HBO Max is targeting 150 million subscribers by year-end 2026, and management flagged "a powerful and impressive business turnaround from a predominantly U.S.-only HBO streaming business losing $2 billion plus in 2022 to a global high growth asset."

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The 2027 slate includes Dune: Messiah, Man of Tomorrow, The Batman Part II, and LOTR: Hunt for Gollum, and the Harry Potter series debuts Christmas Day 2026. JB Perrette told analysts "2027 is arguably our best year yet."

A completed Paramount Skydance deal or competing bid would likely push the stock through consensus targets.

What Could Go Wrong

Our bear scenario is $25.35, a 9.4% drawdown. Net leverage sits at 3.4x on $29.7 billion of net debt, Global Linear Networks revenue fell 17%, and the NBA absence created a 20% ex-FX ad headwind. Analyst tone is muted: 16 of 19 covering analysts sit at hold, with only 2 Buys and 1 Strong Sell.

Insider activity has skewed net selling across 40 recent transactions. Much of Q1's -$1.17 EPS reflected the $2.8 billion Netflix termination fee rather than deteriorating operations, and refinancing the bridge loan should deliver roughly 150 basis points of annual interest savings.

How WBD Compares to Disney and Netflix

Disney (NYSE:DIS) is the closest diversified peer, with a P/E near 15 and fiscal Q3 2026 revenue of $25.25 billion. Disney's Entertainment SVOD hit double-digit margins first, providing a template for what a re-rated WBD streaming business could look like as margins expand from 17% toward the 20%+ long-term target.

Netflix (NASDAQ:NFLX) trades at a P/E near 30 on $12.56 billion in Q2 revenue and a 33.4% operating margin. The gap between Netflix's multiple and WBD's 1.94x price-to-sales and 7.27x EV/EBITDA makes our target look conservative.

Warner Bros. Discovery Price Prediction 2026-2030

Our 24/7 Wall St. price target is $31.88, our recommendation is buy, and our confidence is moderate at 50%. The tipping factor is the Third Point disclosure alongside a streaming segment that posted a 63% ex-FX EBITDA jump.

The bull case strengthens if the Paramount transaction closes or a superior bid emerges. The bear case gains traction if linear ad revenue keeps sliding double digits and leverage refuses to come down.

Extending our model with current growth trajectories:

These projections assume WBD executes its streaming margin ramp and either closes the Paramount deal or continues on the standalone split path. Meaningful upside or downside hinges on the merger outcome, NBA-related ad comparisons rolling off, and the 2027 film slate delivering.

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Contact editorial@247wallst.com for any questions or corrections.