Wall Street trader hits $5 million jackpot with well-timed bet on Warner Bros stock

Core Insights - An unidentified Wall Street trader made a significant profit of approximately $5 million by purchasing call options on Warner Bros Discovery stock just before news of a potential takeover bid by Paramount Skydance emerged [1][5][8] Group 1: Trader's Actions - The trader invested nearly $6 million in 100,000 call options for Warner Bros when the stock was priced at $13.10 [2] - The options allowed the trader to purchase 10 million shares at $15 each before December 19 [4] - Following the news of the potential bid, the stock price surged over 35%, closing at $16.17, which is a 28% increase from the opening price [5][7] Group 2: Market Reaction - The announcement of the potential takeover bid led to a significant increase in Warner Bros' stock price, making the trader's options "in the money," allowing for profitable selling or exercising of the contracts [7] - Bloomberg News estimated the trader's paper profit to be between $4 million and $6 million due to the stock price surge [8] Group 3: Background on Paramount Skydance - Paramount Skydance is reportedly preparing a bid for Warner Bros Discovery with assistance from Larry Ellison's family, specifically his son David, who is the chairman and CEO of Paramount Skydance [5][9]