Just yesterday, word emerged that YouTube TV would no longer be carrying channels for media giant Paramount (PARA) thanks to a contract disagreement. But that disagreement sure got patched up quickly, and Paramount stock shot up over 4% in the closing minutes of Friday’s trading.
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Just yesterday, Paramount announced that its agreement with YouTube TV was set to run out on Thursday night, which was a matter of hours ago. With that agreement expired, it would have taken a large swath of content off YouTube TV, including CBS, CBS Sports, and fully 21 other channels would have been gone, from Nickelodeon to MTV and beyond. With about 141 listed channels, losing 21 of them would have left a substantial hole in YouTube TV’s lineup.
However, once Thursday evening hit, YouTube TV subscribers did not notice a lapse in their available channels in the slightest. Why? Because YouTube TV and Paramount reached a “short-term extension” that would allow the channels to remain in place, if only for a little while.
Oh Yeah, It’s Almost March
The prevailing logic as to how this “short-term extension” got approved is that someone looked at a calendar and discovered that February is over in about two weeks. That means March. And that, in turn, means March Madness. For YouTube TV to suddenly lose that much college basketball would have likely cost it customers, especially given that, just a month ago, YouTube TV raised its prices.
That is not all, though; immediately after the college basketball frenzy comes The Masters, which Paramount also has the rights to. Losing college basketball would have been one thing…losing golf on top of that would have been an even greater disaster. Still though, YouTube TV and Paramount still need to work out a long term arrangement…and Paramount may have lost its whip hand by agreeing to the short-term deal.
Is Paramount Stock a Good Buy Right Now?
Turning to Wall Street, analysts have a Hold consensus rating on PARA stock based on two Buys, one Hold and three Sells assigned in the past three months, as indicated by the graphic below. After a 8.7% loss in its share price over the past year, the average PARA price target of $12 per share implies 6.19% upside potential.
