MeritValue

Warner Bros. Discovery, Inc.

WBDdata completeness 100%19 fiscal years on file
The thesis, from the filings

Warner Bros. Discovery, Inc. earns about -2% on invested capital, below its ~9% cost of capital, but has diluted owners by 281% over 5 years — no moat visible in the numbers. The estimate methods put fair value between $45.93 and $93.24 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$12.2B1$33.8B2$41.3B3$39.3B3$37.3B3
Net income$1.01B4−$7.37B5−$3.13B6−$11.3B6$727M6
Operating cash flow$2.8B7$4.3B8$7.48B9$5.38B9$4.32B9
Capital expenditure$373M10$987M11$1.32B12$948M12$1.23B12
Free cash flow (derived)$2.43B7$3.32B8$6.16B9$4.43B9$3.09B9
Total debt$15.1B13$49.4B14$45.4B15$42.3B16$32.7B16
Cash & equivalents$3.91B17$3.73B18$3.78B19$5.31B20$4.57B20
Diluted shares664.0M1.94B2.44B2.45B2.53B

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$141.97
your share of equity
Profit it earned you last year
$2.87
Free cash flow it threw off
$12.21
Debt you’d be carrying
$129.27

10 shares is a claim on $141.97 of net worth that earned you $2.87 and generated $12.21 of cash last year, against $129.27 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
-2% avg · 5y
FY21 8%FY22 -6%FY23 -1%FY24 -13%FY25 1%

It earned about -2% on invested capital against a ~9% cost of capital — below the cost of funding. The numbers show no moat.

seeing a moat in the numbers →
Management signal · capital allocation
+281% shares · 5y

Share count is up 281% over 5 years — owners have been diluted. Worth asking what they got for it. Total debt has risen 117% over the same window.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0

The 2 estimate methods that apply put fair value between $45.93 and $93.24 a share. They rest on different assumptions, so where they diverge is the story; the Graham Number is a stricter floor, not a target.

DCF · Growth Exit 10Y
$93.24
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth20.0%
  • fcfBase$4.43B
DCF · Growth Exit 5Y
$45.93
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth20.0%
  • fcfBase$4.43B
Earnings Power Value
not applicable
normalized (5y-median) earnings non-positive — EPV undefined
Graham Number
$9.62
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years20.0%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $45.93
The three cases
Bear0.0%$13.88
Base20.0%$45.93
Bull20.0%$45.93

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 20.0%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0001437107-24-000017 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-12-31 · accession 0001437107-25-000031 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-12-31 · accession 0001437107-26-000020 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-12-31 · accession 0001437107-24-000017 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0001437107-25-000031 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0001437107-26-000020 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0001437107-24-000017 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-12-31 · accession 0001437107-25-000031 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-12-31 · accession 0001437107-26-000020 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0001437107-24-000017 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K · period ending 2022-12-31 · accession 0001437107-25-000031 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 10-K · period ending 2023-12-31 · accession 0001437107-26-000020 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 10-K · period ending 2021-12-31 · accession 0001437107-23-000019 (LongTermDebtCurrent)
  14. 10-K · period ending 2022-12-31 · accession 0001437107-24-000017 (LongTermDebtCurrent)
  15. 10-K · period ending 2023-12-31 · accession 0001437107-25-000031 (LongTermDebtCurrent)
  16. 10-K · period ending 2024-12-31 · accession 0001437107-26-000020 (LongTermDebtCurrent)
  17. 10-K · period ending 2021-12-31 · accession 0001437107-23-000019 (CashAndCashEquivalentsAtCarryingValue)
  18. 10-K · period ending 2022-12-31 · accession 0001437107-24-000017 (CashAndCashEquivalentsAtCarryingValue)
  19. 10-K · period ending 2023-12-31 · accession 0001437107-25-000031 (CashAndCashEquivalentsAtCarryingValue)
  20. 10-K · period ending 2024-12-31 · accession 0001437107-26-000020 (CashAndCashEquivalentsAtCarryingValue)