After seeing the news that a Paramount (PARA) shareholder was planning to sue to stop the Skydance/Paramount deal, the first thing I thought was that billionaire Mario Gabelli had finally pulled the trigger. But that turned out not to be the case, as someone else stepped into the fray. It certainly didn’t help share prices, as Paramount lost fractionally in the closing minutes of Thursday’s trading.
Don't Miss our Black Friday Offers:
- Unlock your investing potential with TipRanks Premium - Now At 40% OFF!
- Make smarter investments with weekly expert stock picks from the Smart Investor Newsletter
The latest reports, based around documents filed in Delaware’s Chancery Court, note that the Paramount/Skydance deal would cost shareholders around $1.65 billion total. And yes, the suit wasn’t filed by Gabelli—who’s mentioned plans to do something like this before—but rather by a smaller investor named Scott Baker. Baker noted a key point that others have noted: the deal is excellent for Shari Redstone, but for regular shareholders, the deal ends in a “…significantly lower payout.”
The lawsuit notes that the payout values class B shares at $12.23 per share. As such, when the merger closes, Class B shareholders end up with a $1.65 billion loss. Given that the issue of Class B shareholders in Paramount has already come up at least once in recent memory, it’s not surprising to see someone make a push on their behalf once more.
Ramping Up the Comic-Con Displays
With the San Diego Comic-Con kicking off and running through the weekend, Paramount brought out some of its biggest names to drive some interest in its properties. One of the biggest moves, not surprisingly, was for Star Trek. Fans got a set of interactive displays based on the Discovery, Lower Decks, and Strange New Worlds series, and even some sneak peeks of future developments.
But that wasn’t all; Tulsa King, whose second season kicks off in mid-September, and Dexter: Original Sin, which is still set for an upcoming release, also got some display treatment.
Is Paramount Global a Buy or Sell?
Turning to Wall Street, analysts have a Moderate Sell consensus rating on PARA stock based on three Buys, seven Holds, and 10 Sells assigned in the past three months, as indicated by the graphic below. After a 24.25% loss in its share price over the past year, the average PARA price target of $12 per share implies 4.48% upside potential.
