Is it time to sell your Wildbrain stock?

RBC Dominion Securities analyst Drew McReynolds says WildBrain (WildBrain Stock Quote, Chart, News, Analysts, Financials TSX:WILD) now has a clearer roadmap, but he is waiting for more visibility on the company’s path to its fiscal 2029 Adjusted EBITDA target.

As reported by the Globe and Mail, in a report following WildBrain’s Q3 results, McReynolds maintained his “Sector Perform” rating and lowered his target to $1.50 from $2.00. The average target is $1.82.

WildBrain is a Canadian media, animation, production and brand licensing company known for its children’s programming library.

Management guided to fiscal 2027 Adjusted EBITDA of $28-million to $32-million, up 44% year-over-year at the midpoint, and introduced a fiscal 2029 Adjusted EBITDA target of about $60-million.

McReynolds said that target implies Adjusted EBITDA roughly doubling from the midpoint of fiscal 2027 guidance.

“As we await greater visibility around this trajectory, we remain supportive of the company’s more profitable, capital-light and FCF-generative business model following the sale of Peanuts and closure of Television,” McReynolds said.

The analyst said WildBrain’s strategy now focuses on building long-term franchise value by activating intellectual property across consumer products, content and digital audiences.

The company also introduced new reporting segments and plans $30-million of investment in fiscal 2027, including operating expenses, capital spending and reorganization costs.

McReynolds said those investments are intended to support greater operating scale, lower corporate costs over time and drive revenue growth.

He said management expects continued growth in owned-brand licensing, including Strawberry Shortcake and Teletubbies, along with third-party IP.

WildBrain also expects a fiscal 2027 rebound in production and greenlit projects across live action and animation, with an opportunity to recapture advertising demand in WildBrain Network.

McReynolds said the company’s revenue mix, debt-free balance sheet and commitment to return excess capital through share repurchases lower the stock’s risk profile.

The analyst said the focus now shifts to execution.

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