While some might have thought that the Skydance and Paramount (PARA) merger was done, it is actually not. Not only is there the matter of government regulation to consider, but there’s also the “go-shop” period left in play, at least for about the next three weeks. And reports suggest that businessman and filmmaker Edgar Bronfman Jr., who is also a managing partner at private equity firm Accretive LLC, may still be interested in making a bid for the media giant. That development sent shares up over 1.5% in Tuesday afternoon’s trading.
Apparently, Bronfman has been in talks with financial backers. The exact details of his proposal are unclear and likely will remain so while he tries to iron out the numbers.
However, there’s a certain inherent risk in trying to interject at this point; Skydance, thanks to its connection to Larry Ellison, may have access to almost unlimited financial resources. If sufficiently challenged, it would have to be by a wide enough margin to prevent Ellison from dropping a little more cash to prevent being upstaged by a rival.
Broadcaster Deal
Meanwhile, Paramount still has business to do and is doing it accordingly. It’s just inked a deal with Nexstar, one of the biggest broadcasters around, to modify a couple of Paramount-owned stations. The stations in Miami and Detroit will now be CW Television Network affiliates under the new arrangement. CW is owned by Nexstar, and its stations reportedly have a combined reach of about 15% of the entire U.S. audience, which equates to 19 million households in total.
Additionally, Paramount is pushing out new projects. With the traditional spooky season of Halloween just over two months away, the firm is planning its rollout of Paramount Scares Volume 2, a 4K Ultra HD disc collection of some of Paramount’s biggest horror movies. Titles set for inclusion are Friday the 13th Part II, Breakdown, World War Z, and Orphan: First Kill.
Is Paramount a Good Stock to Buy Now?
Turning to Wall Street, analysts have a Moderate Sell consensus rating on PARA stock based on three Buys, seven Holds, and 10 Sells assigned in the past three months, as indicated by the graphic below. After a 21.77% loss in its share price over the past year, the average PARA price target of $12.07 per share implies 7.62% upside potential.
