Section1: Company Overview and Fundamental Insights

1.1 Company Overview:

WildBrain Ltd (TSX: WILD) is a children's content and brands company, recognized globally for properties such as Peanuts, Strawberry Shortcake, Caillou, Inspector Gadget, and Degrassi franchise. The company owns the independent library of children's content. It licenses its content to broadcasters and streaming services worldwide and generates royalties through its consumer products program.

1.2 The Key Positives, Negatives, Investment Highlights and Risks

1.3 Top 5 Shareholders:

The top 5 shareholders together form ~62.52% of the total shareholding. Fine Capital Partners LP and EastBay Asset Management LLC, holds a maximum stake in the company at ~­­­48.66% and ~8.14%, respectively.

1.4 Key Metrics:

The company is reporting healthy revenue and gross profit, which is a key positive. however, these numbers fell in Q3 2022. Furthermore, Global Kids Advertising Spend is increasing constantly, which supported the company in achieving second highest average monthly viewers in US. these growing numbers helped the company in clocking strong free cash flows, demonstrating its strength and adaptability.

Section 2: Business Updates and Financial Highlights

2.1 Recent Updates: The below picture gives an overview of its recent activities, such as announcement regarding an appointment of new director, adding partnership with NBCUniversal’s streaming platform and signing a new multi-year-deal:

2.2 Insights of Q3 2022 Financial Performance:

Section 3: Key Risks, Company Outlook:

Section 4: Stock Recommendation Summary:

4.1 Price Performance and Technical Summary:

4.2 Fundamental Valuation

Valuation Methodology: EV/Sales Multiple Based Relative Valuation (Illustrative)

Markets are trading in a highly volatile zone currently due to certain macroeconomic issues and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is August 23, 2022. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Technical Indicators Defined:

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock. 

Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock. 

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.

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