December 23, 2025 — Warner Bros. Discovery, Inc. Series A common stock (NASDAQ: WBD) traded around $28.98 in U.S. trading on Tuesday, hovering between two competing takeover paths: Netflix’s agreed cash-and-stock combination for WBD’s studios and streaming assets, and Paramount Skydance’s hostile all-cash tender offer for the whole company.
The latest catalyst hit late Monday and spilled into Tuesday’s market: Paramount Skydance amended its $30-per-share offer, adding a high-profile financing enhancement—an “irrevocable personal guarantee” from Oracle co-founder Larry Ellison covering $40.4 billion of equity financing—while keeping the headline price unchanged. [1]
What changed on December 23—and why WBD stock is reacting
Tuesday’s news flow is less about a higher bid and more about closing certainty. Paramount Skydance’s revised package keeps the offer at $30 per WBD share in cash, but aims to reduce skepticism about whether the funding is truly locked in. Reuters reported that Paramount also increased its regulatory failure fee to $5.8 billion and extended the tender offer deadline to January 21, 2026. [2]
Warner Bros. Discovery, for its part, confirmed receipt of the amended tender offer and said its board—working with independent legal and financial advisers—will review it under the rules of its existing agreement with Netflix. Importantly, WBD said it is not modifying its recommendation supporting the Netflix transaction and advised shareholders not to take any action on Paramount’s amended tender offer while the review is underway. [3]
A key investor’s take: “Necessary, but not sufficient”
Even with Ellison’s guarantee and the higher break fee, a major WBD holder isn’t ready to call it a game-changer.
Reuters reported that Harris Associates (Oakmark), described as WBD’s fifth-largest shareholder, viewed Paramount’s amended offer as still not sufficient—a sentiment echoed in Barron’s coverage of Harris portfolio manager Alex Fitch’s remarks. [4]
This matters for WBD stock because the market is effectively a real-time vote on odds: Will Paramount close? Will Netflix close? Will either bidder improve terms? A large shareholder publicly pushing for “more” can keep the bidding dynamic alive—without guaranteeing a higher final price.
Netflix vs. Paramount: the two deal tracks shaping WBD stock
1) Netflix’s deal: streaming + studios, plus a spin-off
Netflix’s announced agreement is structured around acquiring Warner Bros. after the separation of “Discovery Global.” Under Netflix’s terms, each WBD shareholder would receive $23.25 in cash plus $4.50 in Netflix stock value (per WBD share), for a stated total of $27.75 per share at signing and an implied equity value of ~$72.0 billion and enterprise value of ~$82.7 billion. [5]
A major nuance: the stock component is subject to a collar based on Netflix’s 15-day VWAP measured shortly before closing. If Netflix’s VWAP falls below $97.91, WBD shareholders receive a fixed 0.0460 Netflix shares per WBD share; if above $119.67, they receive 0.0376 shares; within the collar, the stock piece targets $4.50 in value. [6]
Netflix has also moved to bolster financing for the cash portion of the merger consideration. An SEC filing describes Netflix entering into a $5 billion revolving credit facility and two delayed-draw term loan facilities of $10 billion each, designed to support merger financing and related costs. [7]
2) Paramount Skydance’s bid: all-cash tender offer for the full company
Paramount Skydance is taking a more traditional hostile route: an offer to buy all outstanding WBD shares at $30.00 per share in cash (net to the seller), subject to conditions laid out in its tender documents filed with the SEC. [8]
This approach is simple on paper—cash today, no collar math—but the market has been laser-focused on whether Paramount’s financing is as durable as advertised. That’s why Tuesday’s headline is the Ellison guarantee.
Breakup fees and “deal insurance” have become central to the WBD story
These bids aren’t just about price—they’re about what happens if regulators intervene or if the board changes course.
A Reuters report on the Netflix-WBD agreement described a $5.8 billion breakup fee associated with Netflix’s deal, and said WBD would pay Netflix $2.8 billion if the transaction is terminated under certain circumstances. [9]
Those figures also appear in SEC-filed transaction materials describing the $2.8 billion company termination fee and a $5.8 billion regulatory termination fee payable by Netflix under specified conditions tied to antitrust or foreign regulatory outcomes. [10]
In other words, Netflix is effectively offering unusually large “regulatory insurance,” while WBD faces a meaningful cost if it walks away to pursue another suitor—an element the WBD board has repeatedly highlighted in communications around Paramount’s offer. [11]
Why WBD’s board is still backing Netflix (even with a higher $30 headline)
WBD’s public statements and SEC materials outline a consistent logic: the Netflix deal is positioned as more certain, more protective against value leakage, and better aligned with WBD’s planned separation.
In its December 22 update, WBD reiterated it is not modifying its recommendation supporting the Netflix merger agreement. [12]
And in detailed SEC materials discussing the board’s process, WBD cites (among other factors) Netflix’s collar-based value protection, Netflix’s balance sheet and credit profile, a large regulatory termination fee, and the fact that the Netflix structure would not require abandoning the planned Separation and Distribution. [13]
WBD has also argued that regulatory risk is not a material differentiator between the Netflix and Paramount paths—while still emphasizing that Netflix’s termination-fee structure is notably stronger. [14]
WBD stock price vs. offer prices: what the spread is saying today
With WBD near $28.98, the stock is trading:
- Below Paramount’s $30 all-cash offer (suggesting investors assign meaningful probability to delays, conditions, or a non-close), and [15]
- Above the stated $27.75 Netflix value at signing—though that figure is not “fixed” because of the collar mechanics and the time to closing. [16]
To illustrate how the collar matters: Netflix stock traded around $93.25 on Tuesday. If the final VWAP used for the collar were below the $97.91 floor, WBD holders would receive 0.0460 Netflix shares per WBD share, implying roughly $4.29 of Netflix stock value (0.0460 × $93.25) plus $23.25 cash—about $27.54 in total consideration, before accounting for timing and other variables. (This is an example only; the actual closing VWAP window is defined in the agreement.) [17]
That math helps explain why the market is fixated on certainty and timing as much as headline price: WBD is being priced like a live probability-weighted outcome of multiple scenarios, not like a typical media stock.
Analyst forecasts and Wall Street targets: consensus is unusually noisy
Traditional analyst price targets are still circulating—but they’re being interpreted through a deal-arbitrage lens, not a standalone valuation lens.
- Nasdaq, citing Fintel-compiled analyst targets, reported an average one-year price target of $27.78, with targets ranging from $20.20 to $36.75 (as of December 20). [18]
- MarketWatch’s analyst-estimates snapshot shows an “Overweight” average recommendation with an average target price of $27.23 based on 24 ratings. [19]
- TradingView’s compiled forecast likewise shows $27.23 as a price target, with a $35.00 high estimate and $20.00 low estimate, and notes the next earnings report is expected February 20, 2026. [20]
The oddity right now: WBD is trading around—or above—some consensus targets while also sitting below a $30 cash offer. That disconnect is a feature of the moment, not a bug: many targets reflect analysts’ “fundamental” view (and may lag rapid deal-driven repricing), while the stock’s real-time level reflects deal odds, regulatory timing, and bid-improvement expectations.
Today’s independent analysis: has the 2025 rally already priced in the upside?
Not all coverage is purely deal mechanics. Some analysis published Tuesday argues the stock’s massive run-up may already reflect much of the turnaround narrative.
A Simply Wall St analysis dated December 23, 2025 noted WBD’s ~175% one-year return and cited trailing twelve-month free cash flow of about $4.1 billion, with a discounted cash flow model implying an intrinsic value around $29.01 per share—close to where WBD is trading during the bidding battle. [21]
That same piece underscores why the bidding war matters: if a buyer is willing to pay at or above today’s trading range, WBD holders may effectively be deciding between (a) a cleaner cash exit at $30 with Paramount, or (b) Netflix’s structured deal plus the separation outcome—each with different closing timelines and risks.
What to watch next: deadlines, filings, and decision points
Here are the practical catalysts that could move WBD stock from here:
- WBD board’s response to the amended Paramount offer
WBD has said it will review Paramount’s amended tender offer and later advise shareholders on its recommendation. [22] - Tender-offer timing
Reuters reported Paramount extended the tender-offer deadline to January 21, 2026, giving shareholders more time—and giving the market more time to price shifting odds. [23] - Financing and “certainty” chess
Netflix’s new credit facilities (described in SEC materials) and Paramount’s Ellison guarantee are both attempts to win the same argument: “Our deal is financeable and closeable.” [24] - Regulatory and political risk
Reuters has repeatedly flagged that either transaction could draw antitrust scrutiny, and reported political attention around the outcome. [25] - The separation timeline
Reuters reported Netflix’s deal is expected to close after WBD spins off its networks unit into Discovery Global, with completion set for Q3 2026 in that report—meaning time-to-close is itself a valuation input. [26]
The takeaway for WBD stock on December 23, 2025
Warner Bros. Discovery shares are being driven less by quarterly fundamentals and more by deal probability—and Tuesday’s headlines fit that theme: Paramount didn’t raise the $30 price, but tried to make the $30 feel more real with Larry Ellison’s personal backstop; meanwhile, WBD continues to publicly support the Netflix path while it evaluates the revised bid.
Until a board recommendation changes, a bid improves, or regulators signal a clearer path, WBD stock is likely to keep trading like an event-driven security—reacting to legal language, financing details, and shareholder positioning as much as to content strategy.
This article is for informational purposes only and does not constitute investment advice.
References
1. www.reuters.com, 2. www.reuters.com, 3. ir.wbd.com, 4. www.reuters.com, 5. ir.netflix.net, 6. ir.netflix.net, 7. www.stocktitan.net, 8. www.sec.gov, 9. www.reuters.com, 10. www.sec.gov, 11. www.sec.gov, 12. ir.wbd.com, 13. www.sec.gov, 14. www.sec.gov, 15. www.sec.gov, 16. ir.netflix.net, 17. ir.netflix.net, 18. www.nasdaq.com, 19. www.marketwatch.com, 20. in.tradingview.com, 21. simplywall.st, 22. ir.wbd.com, 23. www.reuters.com, 24. www.stocktitan.net, 25. www.reuters.com, 26. www.reuters.com
