Remember when Amazon (NASDAQ:AMZN) bought up MGM and got access to all those old movies and TV shows? Well, as it turns out, a similar deal at one time was brewing between Netflix (NASDAQ:NFLX) and Paramount (NASDAQ:PARA). It was a deal sufficient to send Paramount shares up somewhat in Wednesday afternoon trading and got many to wonder about what might have been. Or, perhaps, could still be.
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There aren’t any details that suggest Netflix might still be interested in Paramount, but if there’s still smoke, there may be fire not too far behind. Interestingly, a Bloomberg report from back in October suggested that Netflix had its eye on Paramount that far back as well.
What sunk the discussions, however, was the future of Paramount’s cable networks like Nickelodeon. Netflix had no interest in those at all, rather focusing on the studio library as well as its lot. Paramount is already having trouble in that vein; it’s trying to sell off Black Entertainment Television (BET), and the former front-runner for the purchase, Tyler Perry, is having trouble accepting the asking price of $3 billion. And with Paramount packed full of franchises, from Star Trek to Spongebob, it’s got room enough to operate if it can get enough cash to exploit all those assets.
Analysts, meanwhile, are looking for a tipping point. With five Buy ratings, five Holds, and seven Sells, Paramount stock is considered a Hold with 21.91% upside potential, thanks to its average price target of $19.36 per share.
