Analyst Downgrades Paramount Global Stock Rating After Skydance Media Acquisition Deal

Paramount Global’s stock rating has been downgraded by Wolfe Research analyst Peter Supino following news of its acquisition by Skydance Media. In his report titled “Maybe We Have Different Dreams,” Supino expressed caution and negativity towards Paramount’s ability to invest profitably in direct-to-consumer (DTC) platforms. With the deal in place, Supino highlighted the challenges Paramount faces in transitioning from traditional TV media to DTC and licensing models.

Despite the concerns, Supino acknowledged the potential cost savings from Skydance’s planned $2 billion-plus in cuts. He also praised David Ellison and his team at Skydance for their ability to address Paramount’s DTC scale deficit with technology, funding, and partnerships. However, Supino warned that Skydance’s financial forecasts may be overly optimistic given the decline in legacy Paramount revenue.

Overall, the future of Paramount Global under Skydance’s ownership remains uncertain as the company navigates the changing landscape of media consumption. Investors will be watching closely to see how the acquisition plays out and whether Paramount can successfully adapt to the evolving market trends.