Is WBD a high-quality business?

AlphaMadera's AlphaQuality grade scores Warner Bros. Discovery, Inc. on six pillars — profitability, capital efficiency, balance-sheet strength, growth durability, cash generation, and shareholder yield. The composite letter grade reflects how WBD compares to a Buffett-style quality bar.

What is Warner Bros. Discovery, Inc.'s AlphaQuality grade?

AlphaQuality assigns a letter grade (A through F) to WBD based on a six-pillar quantitative model. The live page shows the composite grade plus each pillar's individual score with the underlying metrics.

What makes WBD a quality stock?

AlphaQuality looks at return on capital, free-cash-flow margins, debt-to-equity, revenue stability, dividend and buyback policy, and operating-margin trend. Stocks scoring well across all six pillars earn higher grades — the methodology favors compounders over cyclicals.

WBD - Warner Bros. Discovery, Inc.

Price: -- -- | CONSENSUS: Hold DETAILS | PRICE TARGET: $30.80 DETAILS

AlphaQuality

Quantitative six-pillar business-quality grade

Platform & Compounding FCF

AlphaQuality — archetype-weighted quantitative grade

F 30.0 / 100 pillar composite

Composite Grade

Composite of six pillars weighted for platform & compounding fcf businesses. Purely quantitative — no stock price or analyst input.

⚠ 3 of the last 5 fiscal years showed negative net income — AlphaQuality will not grade above F for persistent unprofitability in a platform & compounding fcf business.

Grade overrides the 30.0 pillar composite because hard gates always win. Use the pillar breakdown below to see where the underlying numbers sit.

Profitability

Weight: 25%

F 4.0

5yr Avg ROIC -2.2% 6/100
Operating Margin Trend -2.97 pp/yr 0/100

Capital Efficiency

Weight: 15%

F 0.0

5yr Avg ROE -11.2% 0/100
5yr Share-Count CAGR 39.5% 0/100

Growth Quality

Weight: 25%

C+ 57.0

5yr Revenue CAGR 32.3% 100/100
5yr EPS CAGR -34.1% 0/100
Revenue-Growth Years (5) 3/5 60/100

Cash Generation

Weight: 20%

B 71.5

5yr FCF Margin 12.8% 77/100
5yr FCF/NI Conversion 3.33x 65/100

Balance Sheet

Weight: 10%

D 33.2

Net Debt / EBITDA 2.97x 51/100
Interest Coverage (EBIT/Int) 1.79x 25/100
Altman Z-Score 0.79 12/100

Stability

Weight: 5%

C- 44.3

EPS Volatility (σ/μ) 0.53 28/100
Piotroski F-Score 5 56/100
Negative-Revenue Years (5) 2/5 60/100

5 of 5 gurus held; 2 added; 3 trimmed.

Holders: 5
Avg Δ position: +131.4%
New buys: 0
Full exits: 0

Soros increased +628%
Greenblatt increased +243%
Dalio decreased -97%

How this is calculated

AlphaQuality grades six pillars from 0-100 and weights each by archetype:

Profitability (25%) — 5yr Avg ROIC, Operating Margin Trend
Capital Efficiency (15%) — 5yr Avg ROE, 5yr Share-Count CAGR
Growth Quality (25%) — 5yr Revenue CAGR, 5yr EPS CAGR, Revenue-Growth Years (5)
Cash Generation (20%) — 5yr FCF Margin, 5yr FCF/NI Conversion
Balance Sheet (10%) — Net Debt / EBITDA, Interest Coverage (EBIT/Int), Altman Z-Score
Stability (5%) — EPS Volatility (σ/μ), Piotroski F-Score, Negative-Revenue Years (5)

We deliberately ignore stock price, analyst targets, and consensus ratings so the grade is suitable for backtesting forward returns. A minimum of 5 fiscal years of audited statements is required; distressed and highly leveraged infrastructure businesses are declared ungradable rather than forced into a numeric score.