Skydance completed its takeover of Warner Bros. Discovery on Oct. 6, and the combined company owns HBO, CBS, CNN and Paramount Pictures. Its shares trade at $7.06, down 22.2% over the past week, for a market value of about $35.4 billion, versus Netflix's $291.5 billion. Pro forma net debt of $78.9 billion is more than double the stock's market value, and the author estimates leverage near 6 times, against a 3.75 times target for 2028 that relies on $6 billion of synergies. Skydance raised $47 billion of equity at $12 per share, and the stock now sits 41.2% below that price. Skydance targets $10 billion or more of free cash flow by 2030, while Netflix's operating margin is 33.4%, compared with Skydance's just below 5%, and the author concludes the discount looks earned.
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