From The Motley Fool · Anders Bylund · · 1m
Skydance Trades at a Fraction of Netflix's Valuation
Skydance trades at 1/8 Netflix's valuation despite massive debt and shrinking cable networks.
In brief
Skydance trades at 1/8 Netflix's valuation despite massive debt and shrinking cable networks. Skydance's discount from Netflix is earned due to high debt and declining cable revenue. Originally reported by The Motley Fool.
Skydance merger completion
Skydance finally swallowed Warner Bros. Discovery on Oct. 6.
Market reaction
Shares closed at $9.07 on Oct. 13 and trade at $7.06 today, down 22.2% over the past week.
Skydance valuation
At roughly 5 billion shares, the whole empire is worth about $35.4 billion.
Netflix valuation
Netflix sits at $291.5 billion, about 8 times larger than Skydance.
Skydance debt
Skydance's pro forma net debt is $78.9 billion, more than double its market cap.
Merger purchase price
To close the merger, Skydance raised $47 billion at $12 per share.
Business performance
Warner Bros. Discovery's revenue fell 11.2% year over year with declining linear ad sales.
The bottom line
Skydance's discount from Netflix is earned due to high debt and declining cable revenue.
