In a move that will likely come as a relief to the staff at entertainment giant Paramount (PARA) who lost their jobs, there is some good news for the three CEOs that currently occupy Paramount. Their jobs are likely on the firing line, but their golden parachutes will be well-stocked. Investors found this welcome news, apparently, as Paramount was up fractionally in the closing minutes of Wednesday’s trading.
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The good news for the current co-CEOs—Brian Robbins, Chris McCarthy, and George Cheeks—is that they will be well taken care of in the likely event they lose their jobs once the Skydance/Paramount merger goes through. In fact, their employment agreements now include clauses that allow them to quit and receive a severance package.
Oh, and that is not all. Each of them will receive grants of $3 million worth of “restricted share units” in Class B common stock, which will vest over three years beginning on the first anniversary of the grant date. This is on top of additional salary boosts the triumvirate got back in June, where they landed annual cash bonuses that were increased by 100% of their original base salaries.
Another Network Loss
Meanwhile, more bad news emerged for Paramount’s linear channels, as Altafiber customers in the Cincinnati area will not be seeing them. Some of the most popular cable channels—Comedy Central, Nickelodeon, and MTV—will not be found as Altafiber is in a carriage battle with Paramount.
Altafiber sent a notice to subscribers informing them that Paramount wanted a lot more money for its channels than Altafiber was prepared to pay. With Paramount also focusing particularly on its streaming platforms for new content, this combination of higher prices and lower content was “unfair,” according to Altafiber.
Is Paramount Stock a Good Buy Right Now?
Turning to Wall Street, analysts have a Hold consensus rating on PARA stock based on three Buys, six Holds, and four Sells assigned in the past three months, as indicated by the graphic below. After a 14% loss in its share price over the past year, the average PARA price target of $12.67 per share implies 20.61% upside potential.
