Warner Bros. Discovery (NASDAQ: WBD) and Paramount Global (NASDAQ: PARA) both emerged as newly rebranded versions of old media companies last year. Warner Bros., which was created by AT&T's spin-off of WarnerMedia and its merger with Discovery, started trading as a stand-alone company last April. ViacomCBS, which was created by the re-merging of Viacom and CBS in late 2019, rebranded itself as Paramount Global last February and changed its ticker symbol to PARA.

But investors haven't been enthusiastic about either stock. WBD's stock is down nearly 40% since its first trading day, while Paramount's stock slumped almost 30% since its rebranding. Both stocks tumbled for similar reasons: Their advertising businesses faced fierce macro headwinds, and their loss-leading streaming strategies compressed their margins. Should investors consider buying either of these out-of-favor media stocks as the bulls look the other way?

Image source: Getty Images.

Continue reading

Source Fool.com