When you are a media company like Paramount (PARA), it might be natural to assume that one of the biggest segments of your operation — the one that is mostly responsible for cash flow — would be largely immune to layoffs. That’s not actually the case, however, as Paramount’s advertising division is next on the chopping block. Investors were pleased with this, however, as shares were up nearly 1.5% in Wednesday afternoon’s trading.
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Paramount’s larger goal to cut 15% of its work force in a bid to generate $500 million in total savings managed to hit Paramount Advertising as well. Paramount Advertising handles ad sales across most, if not all, of Paramount’s properties, from its linear television operations to its Paramount+ and Pluto TV arms. While the exact body count of lost employees is unclear, we do know that some jobs were lost.
A certain amount of this is due to redundancy. Skydance, who finally managed to buy Paramount, is bringing in some of its own staff, which means some Paramount personnel will just not be needed anymore. Paramount has been selling off assets as well, trying to raise money to cut back on losses. Further, Paramount is looking for the Skydance takeover to “revitalize” CBS by providing access to “new resources.”
“Trash” Coverage in Soccer
Meanwhile, we know that Paramount has made great headway with its internal sports coverage. However, not all of it has always gone well. Recently, CBS Sports was called out for “trash coverage” of European soccer matches, including a recent post-game interview between Thierry Henry and Christian Pulisic of Milan. The Milan / Liverpool match ended oddly, with Henry apparently showing “…negative body language,” including a “blunt…rejection” of the entire Pulisic interview.
It was not all bad news, though, as Paramount also welcomed back Frasier, which would see its second season premier on Thursday. The series, a reboot of the original, has been drawing significant attention, and should keep viewers interested. Advertisers, meanwhile, are likely to follow from there.
Is Paramount a Good Stock to Buy Now?
Turning to Wall Street, analysts have a Hold consensus rating on PARA stock based on three Buys, eight Holds and seven Sells assigned in the past three months, as indicated by the graphic below. After a 20.79% loss in its share price over the past year, the average PARA price target of $12.13 per share implies 14.81% upside potential.
