By Angela Palumbo
Warner Bros. Discovery stock climbed Monday after the entertainment company said it reached an agreement with the National Basketball Association following months of uncertainty.
Warner Bros. announced that its TNT Sports and the NBA agreed to extend their media partnership an additional 11 years. The deal will give TNT Sports the right to produce and distribute new and existing NBA content across its platforms. Popular basketball studio show Inside the NBA, which includes Charles Barkley and Shaquille O'Neal, will move to Walt Disney's ABC and ESPN.
"We are pleased to partner with the NBA and Disney/ESPN, and to have solidified long-term rights and revenue for WBD," said Chief Executive David Zaslav.
Shares of Warner Bros. were rising 3.1% Monday to $9.50.
While TNT has historically attracted basketball viewers, there has been uncertainty about whether that audience would remain after the NBA said in July it had signed an 11-year media agreement with Disney, Comcast's NBCUniversal, and Amazon Prime Video. Warner Bros. then sued the NBA for breach of contract.
Amazon declined to respond to a Barron's request for comment. Comcast didn't immediately respond to a comment request.
"We are glad to see this dispute finally resolved, and WBD recoup some economic value after it was not able to maintain its NBA media rights," Raymond James analyst Ric Prentiss wrote in a research note Monday.
He has an Outperform rating and $12 price target on the Warner Bros. stock.
"We think questions about the loss of the NBA have been the biggest overhang for the WBD stock recently, and we feel an inability to communicate about these questions have only exasperated that overhang," Prentiss added.
Shares of Warner Bros. have dropped 16% this year, compared with the 23% increase of the S&P 500.
Entertainment companies are doing all they can to bring in new subscribers to their streaming platforms and maintain customers on legacy television. The latest plan has been a push into sports. Amazon.com hosts Thursday Night Football on Prime, and subscribers can watch Sunday Night Football on Comcast's Peacock.
Netflix made headlines Monday after many viewers who tried to watch the boxing match between internet personality Jake Paul and fighter Mike Tyson over the weekend experienced streaming glitches. Netflix will also be hosting the NFL's Christmas games.
Write to Angela Palumbo at angela.palumbo@dowjones.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
November 18, 2024 12:47 ET (17:47 GMT)
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