Media company Paramount (NASDAQ:PARA) by itself was never much of a threat in the streaming wars. It showed up way too late to make much impact, and even its vast array of intellectual property gave it only so much punch in the market. But with new reports about a merger between Paramount and Comcast’s (NASDAQ:CMCSA) Peacock, a different story is shaping up. Citi managing director Jason Bazinet has a “minority” opinion about Paramount’s fortunes going forward. He believes a Paramount and Peacock team-up could “…compete with the likes of Netflix (NASDAQ:NFLX).”
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While pricing might prove an issue, costs are likely to go up anyway, a point not lost on anyone who’s paying more for streaming services these days. Yet, with so many apps in the field already, consolidation would likely start to save money somewhere in the ecosystem.
Bundling on the Rise
Increasingly, we’re seeing several streaming services start to come together to offer their various platforms as bundles. This is leading some commentators to declare that streaming is basically becoming cable, with big piles of content that customers either take or leave. This wasn’t how many hoped it would go, of course; users wanted to watch what they wanted when they wanted, not be forced to pay for the whole menu and eat what they liked along the way.
But with linear television on the ropes—Michigan sources alone report cable customer counts declined another 13% in 2023—it’s clear something has to fill in the gap. And with Paramount reportedly considering offers from several potential buyers already, that something may show up sooner rather than later.
Is Paramount Global a Buy or Sell?
Turning to Wall Street, analysts have a Moderate Sell consensus rating on PARA stock based on three Buys, two Holds, and eight Sells assigned in the past three months, as indicated by the graphic below. After a 46.07% loss in its share price over the past year, the average PARA stock target of $14.58 per share implies 21.8% upside potential.
