5 Most Promising Stocks to Buy According to Analysts

4. Warner Bros. Discovery, Inc. (NASDAQ:WBD)

Number of Hedge Fund Holders: 60

One-Year Average Price Estimate: $20.90

Entertainment giant Warner Bros. Discovery, Inc. (NASDAQ:WBD) is increasing its presence in the gaming industry. Recently, Warner Bros. Discovery, Inc. (NASDAQ:WBD) said that “Hogwarts Legacy” game has recorded 12 million units sold and touched $850 million in sales globally in its first two weeks of launch. The Harry Potter-themed game was developed by Avalanche Software and was published by Warner Bros. Discovery, Inc. (NASDAQ:WBD).

Artisan Value Fund made the following comment about Warner Bros. Discovery, Inc. (NASDAQ:WBD) in its Q4 2022 investor letter:

“Warner Bros. Discovery, Inc. (NASDAQ:WBD) is a global media and entertainment company that is the result of the 2022 merger of Discovery and WarnerMedia. Warner is known for its theatrical releases, networks (CNN, TNT, TBS) and pay television network HBO and related over-the-top streaming service HBO Max. The legacy Discovery business distributes content across US and international networks—such as HGTV, Discovery, TLC, Food Network and Animal Planet—as well as its own streaming service Discovery+. We believe the total portfolio of content and entertainment assets should provide a compelling direct-to-consumer offering to attract viewers and the scale to invest in original content. There is a lot of opportunity, but there’s also uncertainty related to the merger’s integration and realized cost synergies. These questions, in addition to a challenging macro environment for advertising and foreign exchange headwinds, have been overhangs on the stock price.

Further, media and entertainment stocks have come under pressure due to skepticism about the industry’s long-term economics. Our view is streaming is a scale and intellectual property business that will result in a few large winners, and we believe HBO Max will be among this group. WBD looks like a bargain, selling at a double-digit FCF yield.”