Skydance Slides Another 8% as $80B Debt Load and Warrant Overhang Spook Investors
SKYD sits 15% above its 52-week low of $7.62.
Summary
Skydance shares fell another 8% on their second day of trading, extending the post-merger slide as investors digest the combined company's $80B debt load and integration challenges. The decline follows the October 6 completion of the Warner Bros. Discovery acquisition and an immediate debt restructuring push. Management outlined a multi-year plan targeting mid-single-digit revenue growth through 2030, $6B in run-rate synergies within three years, and net leverage of 3.75x by 2028, but UBS analyst John Hodulik warns that legacy TV still accounts for at least two-thirds of profits, making the streaming transition daunting. Adding to the pressure, the company will distribute roughly 470M warrants on October 13 with a $12 exercise price, which Hodulik says will keep shares volatile given the low float. The warrants currently have no intrinsic value but could trade around $3 each based on long-term upside potential.
At the time of this announcement, SKYD was trading at $8.79 on NYSE in the Trade & Services sector, with a market capitalization of approximately $9.9B. The 52-week trading range was $7.62 to $19.22. This news item was assessed with negative market sentiment and an importance score of 7 out of 10. Source: Seeking Alpha.