Analyzing Warner Bros. Discovery (NASDAQ:WBD) and TEGNA (NYSE:TGNA)

Warner Bros. Discovery (NASDAQ:WBD) and TEGNA (NYSE:TGNA) are both consumer discretionary companies, but which is the better business? We will compare the two companies based on the strength of their valuation, institutional ownership, analyst recommendations, risk, profitability, dividends and earnings.

Risk and Volatility

Warner Bros. Discovery has a beta of 1.51, suggesting that its stock price is 51% more volatile than the S&P 500. Comparatively, TEGNA has a beta of 0.3, suggesting that its stock price is 70% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Warner Bros. Discovery and TEGNA, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Warner Bros. Discovery	0	11	11	1	2.57
TEGNA	0	1	3	0	2.75

Warner Bros. Discovery presently has a consensus price target of $12.17, indicating a potential upside of 7.71%. TEGNA has a consensus price target of $20.25, indicating a potential upside of 20.87%. Given TEGNA’s stronger consensus rating and higher probable upside, analysts plainly believe TEGNA is more favorable than Warner Bros. Discovery.

Valuation and Earnings

This table compares Warner Bros. Discovery and TEGNA”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Warner Bros. Discovery	$39.32 billion	0.71	-$11.31 billion	($4.40)	-2.57
TEGNA	$3.10 billion	0.87	$599.82 million	$2.84	5.90

TEGNA has lower revenue, but higher earnings than Warner Bros. Discovery. Warner Bros. Discovery is trading at a lower price-to-earnings ratio than TEGNA, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Warner Bros. Discovery and TEGNA’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Warner Bros. Discovery	-28.16%	-30.56%	-10.27%
TEGNA	15.29%	17.13%	6.94%

Insider & Institutional Ownership

60.0% of Warner Bros. Discovery shares are owned by institutional investors. Comparatively, 92.2% of TEGNA shares are owned by institutional investors. 1.9% of Warner Bros. Discovery shares are owned by insiders. Comparatively, 0.5% of TEGNA shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Summary

TEGNA beats Warner Bros. Discovery on 10 of the 15 factors compared between the two stocks.

About Warner Bros. Discovery

Warner Bros. Discovery, Inc. operates as a media and entertainment company worldwide. It operates through three segments: Studios, Network, and DTC. The Studios segment produces and releases feature films for initial exhibition in theaters; produces and licenses television programs to its networks and third parties and direct-to-consumer services; distributes films and television programs to various third parties and internal television; and offers streaming services and distribution through the home entertainment market, themed experience licensing, and interactive gaming. The Network segment comprises domestic and international television networks. The DTC segment offers premium pay-tv and streaming services. In addition, the company offers portfolio of content, brands, and franchises across television, film, streaming, and gaming under the Warner Bros. Motion Picture Group, Warner Bros. Television Group, DC, HBO, HBO Max, Max, Discovery Channel, discovery+, CNN, HGTV, Food Network, TNT Sports, TBS, TLC, OWN, Warner Bros. Games, Batman, Superman, Wonder Woman, Harry Potter, Looney Tunes, Hanna-Barbera, Game of Thrones, and The Lord of the Rings brands. Further, it provides content through distribution platforms, including linear network, free-to-air, and broadcast television; authenticated GO applications, digital distribution arrangements, content licensing arrangements, and direct-to-consumer subscription products. Warner Bros. Discovery, Inc. was incorporated in 2008 and is headquartered in New York, New York.

About TEGNA

TEGNA Inc., a media company, provides broadcast advertising and marketing products and services for businesses. The company operates 47 television stations in 39 markets of the United States that produce local programming, such as news, sports, and entertainment. It offers local and national non-political advertising; political advertising; production of programming from third parties; production of advertising materials; and digital marketing services, as well as advertising services on the stations' Websites, tablets, and mobile products. The company also sells commercial advertising spots of its television stations. In addition, it operates Premion, an over the top local advertising network; Hatch, a centralized 360-degree marketing services agency; and radio broadcast stations. The company was formerly known as Gannett Co., Inc. and changed its name to TEGNA Inc. in June 2015. TEGNA Inc. was founded in 1906 and is headquartered in McLean, Virginia.