Netflix and Warner Bros. Reach All-Cash Deal Valued at $27.75

Written by Emily J. Thompson, Senior Investment Analyst

AMZN+2.06%

DIS-1.97%

PSKY-0.68%

Updated: 1d ago

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"Now Streaming" is The Fly's weekly recap of the stories surrounding the biggest content streamers.PLAYING THIS WEEKEND:This weekend's most notable new streaming content is science fiction body horror series "The Beauty," which premiered on Hulu on January 21 and stars Ashton Kutcher, Rebecca Hall, and Evan Peters. Meanwhile, Amazon Prime Videousers can watch British heist series "Steal," starring Sophie Turner. Additionally, Netflixsubscribers can watch live-streamed even "Skyscraper Live," which involves "Free Solo" climber Alex Honnold attempting to scale the Taipei 101, as well as the reboot of talent competition series "Star Search."NETFLIX/WARNER BROS.:On Tuesday, Netflix and Warner Bros. Discoverythey have amended their definitive agreement for Netflix's pending acquisition of Warner Bros. to an all-cash transaction. The revised agreement simplifies the transaction structure, provides greater certainty of value for WBD stockholders, and accelerates the path to a WBD stockholder vote. The all-cash transaction continues to be valued at $27.75 per WBD share, unchanged from the prior transaction structure. WBD stockholders will also receive the additional value of shares of Discovery Global following its separation from WBD. The transaction will be financed through a combination of cash on hand, available credit facilities and committed financing. The amended, all-cash transaction was unanimously approved by the Boards of Directors of both Netflix and WBD. Closing remains subject to completion of the Discovery Global separation, receipt of required regulatory approvals, approval of WBD stockholders and other customary closing conditions.Meanwhile, on Thursday, Paramount Skydanceit has filed preliminary proxy materials with the U.S. Securities and Exchange Commission to solicit shareholders of Warner Bros. Discovery to vote against the amended transaction with Netflix and related proposals at the special meeting of WBD stockholders. Paramount has also extended its $30 per share all-cash tender offer to February 20, 2026, reaffirming its commitment to a transaction with WBD at a $108.4B enterprise value that is "significantly greater and far more certain than the purported $82.7B enterprise value of the Netflix transaction."Following the announcement, the Financial Times reported that Netflix co-CEO Greg Peters said the company is on track to win the backing of Warner Bros. shareholders for its $82.7B offer for the company. In an interview with FT, Peters said Paramount's bid "doesn't pass the sniff test" and only a "very small" number of Warner Bros. shares have been tendered in support of Paramount's hostile $108B offer.NETFLIX RESULTS:In addition to the Warner Bros. news, Netflix alsofourth quarter results this week, with earnings per share and revenue beating consensus expectations. Looking ahead, however, the company provided a conservative outlook for Q1, as well as its revenue expectations for 12%-14% growth in FY26. Additionally, Netflix said in its quarterly investor letter that it is pausing share buybacks to help fund its pending acquisition of Warner Bros.Following the quarterly report, no fewer than 15 analysts cut their price targets on Netflix, with Piper Sandler lowering the firm's target to $103 from $140 but maintaining an Overweight rating. The firm noted the company reported a solid Q4 2025 print with revenues 70bps above Piper Sandler consensus and EBIT 330bps better. Meanwhile, Goldman Sachs analyst Eric Sheridan lowered the firm's price target on Netflix to $100 from $112 with a Neutral rating, saying that while long-term prospects remain supported by content strength, margin expansion, and strategic investments, including the revised all-cash Warner Bros. Discovery transaction, greater clarity on regulatory approval, competitive dynamics, and pro-forma operating details is needed for a meaningful multiple re-rating.DISNEY CEO:In a regulatory filing on Thursday, Disneychairman of the board James Gormanthe media giant expects to announce the appointment of its next CEO in early 2026. "Management succession planning remains a top priority for the Board, reflecting its importance to business continuity and long-term shareholder value," Gorman said. "Oversight of the process is led by our dedicated Succession Planning Committee, and all directors have actively participated in a rigorous and ongoing evaluation of potential successor candidates, including direct engagement, performance assessment and consideration of leadership capabilities aligned with the company's long-term strategy. The appointment of the next CEO will be determined by the full Board, and we currently expect to announce the appointment of the company's next CEO in early 2026."STOCK PLAYS:Other publicly traded companies in the space include Comcast, Apple, FuboTV, Fox, Roku, and AMC Networks.

AMZN

$239.16+Infinity%1D

Analyst Views on AMZN

Wall Street analysts forecast AMZN stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for AMZN is 294.69 USD with a low forecast of 250.00 USD and a high forecast of 340.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.

47 Analyst Rating

46 Buy

1 Hold

0 Sell

Strong Buy

Current: 234.340

Low

250.00

Averages

294.69

High

340.00

Current: 234.340

Low

250.00

Averages

294.69

High

340.00

Rothschild & Co Redburn

Neutral

downgrade

$250 -> $230

2026-01-21

New

Reason

Rothschild & Co Redburn

Price Target

$250 -> $230

AI Analysis

2026-01-21

New

downgrade

Neutral

Reason

Rothschild & Co Redburn lowered the firm's price target on Amazon.com to $230 from $250 and keeps a Neutral rating on the shares.

Susquehanna

Bascome Majors

Neutral

maintain

$105 -> $115

2026-01-20

New

Reason

Susquehanna

Bascome Majors

Price Target

$105 -> $115

2026-01-20

New

maintain

Neutral

Reason

Susquehanna analyst Bascome Majors raised the firm's price target on UPS (UPS) to $115 from $105 and keeps a Neutral rating on the shares. The firm said near term they believe parcel demand is solid and investors concern around the well-telegraphed second phase of Amazon's (AMZN) "glide-down" in 1H26 drives a fairly benign setup for the shares.

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Cantor Fitzgerald

Overweight

downgrade

$315 -> $260

2026-01-08

Reason

Cantor Fitzgerald

Price Target

$315 -> $260

2026-01-08

downgrade

Overweight

Reason

Cantor Fitzgerald lowered the firm's price target on Amazon.com to $260 from $315 and keeps an Overweight rating on the shares. Despite lingering macro concerns, the outlook for Global Internet stocks into 2026 is increasingly positive as AI enters a "Synergy" phase that should drive accelerating revenue growth, improved value capture, and clearer long-term returns on capex, the analyst tells investors in a research note. With valuations still about 20% below medium-term ranges despite 2025 outperformance, the group is positioned to outperform in 2026 amid positive estimate revisions and improving sentiment, Cantor says.

Jefferies

David Hayes

Buy

downgrade

2026-01-06

Reason

Jefferies

David Hayes

Price Target

2026-01-06

downgrade

Buy

Reason

Jefferies analyst David Hayes lowered the firm's price target on Puig Brands (PUGBY) to EUR 20.60 from EUR 21.30 and keeps a Buy rating on the shares. The firm considers the risks of a fading fragrance cycle, the implications of Charlotte Tilbury on Amazon (AMZN), and the prospects of an acquisition in skin care, the analyst tells investors in a research note. The firm added it remains bullish on the stock, but it requires consistent delivery to rebuild credibility.

About AMZN

Amazon.com, Inc. provides a range of products and services to customers. The products offered through its stores include merchandise and content it has purchased for resale and products offered by third-party sellers. The Company’s segments include North America, International and Amazon Web Services (AWS). It serves consumers through its online and physical stores and focuses on selection, price, and convenience. Customers access its offerings through its websites, mobile apps, Alexa, devices, streaming, and physically visiting its stores. It also manufactures and sells electronic devices, including Kindle, Fire tablet, Fire TV, Echo, Ring, Blink, and eero, and develops and produces media content. It serves developers and enterprises of all sizes, including start-ups, government agencies, and academic institutions, through AWS, which offers a set of on-demand technology services, including compute, storage, database, analytics, and machine learning, and other services.

About the author

Emily J. Thompson

Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.