Warner Bros. Discovery stock has been the surprising leader of the S&P 500 in September with about a 70% gain. Shares of the media giant soared following reports that Paramount Skydance was considering a buyout bid backed by the Ellison family.
Warner Bros. Discovery stock jumped about 29% on Sept. 11 after the Wall Street Journal reported that Paramount Skydance was preparing an all-cash bid for the entire company, including its cable networks and movie studio. The bid was expected to be backed by the Ellison family. David Ellison serves as CEO of Paramount Skydance, while his father, Larry, leads Oracle.
David Ellison's Skydance officially completed its $8 billion purchase and merger with Paramount Global on Aug. 7.
Warner Bros. Discovery is preparing to split into two publicly traded companies by mid-2026, it announced in June. The new streaming and studios company, which will be called Warner Bros., will consist of Warner Bros. Television, Warner Bros. Motion Picture Group, DC Studios, HBO, HBO Max, Warner Bros. Gaming Studios, and their film and television libraries. The new Discovery Global will consist of its sports and news TV brands, including CNN, TNT Sports, Discovery, free-to-air channels across Europe, as well as the Discovery+ streaming service and Bleacher Report.
Paramount Skydance is said to be readying its bid ahead of Warner Bros.' split in an effort to preempt a potential bidding war for the studio and streaming unit, which could see interest from companies like Amazon.com and Apple.
However, Paramount Skydance has yet to approach Warner Bros. with an official bid. Meanwhile, CEO David Zaslav began shopping the company to potential suitors, according to Wednesday reports from the New York Post.
Warner Bros. Discovery was created in a spinoff from AT&T, when WarnerMedia merged with Discovery in April 2022.
Zaslav will lead the new Warner Bros., while CFO Gunnar Wiedenfels will lead Discovery Global, based on its separation plans and barring any buyout news.
Nexstar's Tegna Acquisition
Warner and Paramount aren't the only media companies looking at a potential deal. Nexstar in August agreed to buy Tegna in a $6.2 billion deal.
The acquisition has been approved by both companies' boards, but is still awaiting approval from the Federal Communications Commission, according to reports.
Nexstar owns or partners with more than 200 stations across 116 U.S. markets, reaching 220 million people, according to the company. Tegna touts that it is the largest owner of "Big Four" affiliates, including ABC, CBS, NBC and Fox, in the top 25 markets among independent station groups, reaching about 39% of TV households nationwide. It also owns 64 news brands in 51 markets.
Warner Bros. Stock Leads S&P 500
WBD stock has rocketed 70% in September, marking the what so far has been the month's top gain in the S&P 500.
Shares have rallied nearly 87% this year and are trading at their highest level since May 2022.
Paramount Skydance is also trading at three-year highs, with a 29% gain in September. PSKY stock has jumped 81% in 2025.
Nexstar is forming a flat base with support at the stock's 10-week moving average, but has traded sideways the past several weeks as the Tegna deal hangs in limbo. NXST stock is up 25% this year.
You can follow Harrison Miller for more stock news and updates on X/Twitter @IBD_Harrison
