BalkansCat
Summary
- Warner Bros. Discovery is facing challenges in meeting market expectations.
- Management has been pushing back against unrealistic expectations and emphasizing the time needed for strategic decisions to show results.
- The streaming sector is particularly prone to misinformation and unrealistic expectations, but management has made progress in turning huge losses into small profits.
- A strategic change can take a few years to become apparent to shareholders and customers.
- Deleveraging without causing a major impact to the business is a tightrope that this management successfully navigated even though many do not.
- I am Long Player. I focus on Oil and Gas stocks. I’m a retired CPA, and have a MBA and MA. I lead the investing group Oil & Gas Value Research.
The attention span of Mr. Market is frequently limited. Oftentimes, the market does not give a large acquisition like the one that created Warner Bros. Discovery (NASDAQ:WBD) the time needed to “clean house” and optimize operations. As we get near the end of the second full year (which is not a calendar year) of operations, it may be time to review some original management messages and how they apply to the latest management communications. Not only is Mr. Market not interested, but Mr. Market is also hostile to that sheer amount of time to wait for results. This is shown in the stock price. Investors can take advantage of that attitude and the forgetfulness to get a better than originally forecasted return.
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