Under normal circumstances, one would believe that the merger between Skydance Media and Paramount Global (PARA) would be a slam dunk. But media reports claim the deal might be put at risk under the administration of president-elect Donald Trump.
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Specifically, there are signs the Trump Administration’s pick of Gail Slater to run the Federal Trade Commission (FTC) will be taking a closer look at the Skydance / Paramount merger, and may end up scuttling the whole affair.
The biggest reason seems to trace back to bias as CBS is increasingly being regarded as “a propaganda arm of the Democratic Party.” And the FTC is not the only one concerned. Not long ago, the Federal Communications Commission (FCC) also stepped in to express concern about how the network has violated “public interest” clauses.
Firings at the Top
If the deal goes through—which was no longer the foregone conclusion it once was—at least one of Paramount’s CEOs will likely also be shown the door. Brian Robbins was already expected to depart once the deal is finalized, but George Cheeks, who handles CBS, is expected to stick around. The only wildcard in the proceedings is Chris McCarthy.
McCarthy was actually on good terms with former CEO Bob Bakish, and that association may taint him going forward. Cheeks, meanwhile, is on good terms with Jeff Shell, who will be just under Skydance CEO David Ellison. That in turn suggests that Cheeks’ position with the new Paramount may be much more secure than McCarthy’s role.
Is Paramount Stock a Good Buy?
Turning to Wall Street, analysts have a Hold consensus rating on PARA stock based on three Buys, seven Holds, and four Sells assigned in the past three months, as indicated by the graphic below. After a 26% loss in its share price over the past year, the average PARA price target of $12.60 per share implies 14.91% upside potential.
