Why Is Paramount Stock Trading Lower Tuesday?

Paramount Global PARA stock is trading lower Tuesday on report citing the company’s plans to reduce its workforce by approximately 800 employees, equating to 3% of its total staff, CEO Bob Bakish detailed in a recent internal memo. 

This decision follows closely on the heels of CBS’s announcement of achieving record viewership for the Super Bowl. Paramount, which concluded 2022 with around 24,500 employees, is taking this step to streamline operations and focus on strategic goals for the upcoming year, CNBC reports.

The media conglomerate, which encompasses a wide range of assets such as CBS, Paramount Pictures, Pluto TV, Paramount+, and cable networks like Nickelodeon, BET, and Comedy Central, is exploring merger and acquisition opportunities. 

This includes preliminary discussions with entities like Skydance Media and Warner Bros. Discovery Inc WBD. 

These layoffs were hinted at in a prior internal memo, with Bakish mentioning the necessity for Paramount Global to become a leaner organization and reduce expenditures.

The company’s streaming service, Paramount+, continues to report financial losses, with a $238 million loss recorded in the third quarter. Paramount Global will announce its fourth-quarter earnings at the end of February. 

Prior reports indicated streaming companies battling difficulties in retaining subscribers amidst price hikes. 

Price Action: PARA shares traded lower by 2.05% at $13.14 on the last check Tuesday.

Paramount’s Stock Prediction For 2024

Equity research analysts on and off Wall Street typically use earnings growth and fundamental research as a form of valuation and forecasting. But many in trading turn to technical analysis as a way to form predictive models for share price trajectory.

Some investors look to trends to help forecast where they believe a stock could trade at a certain point in the future. Looking at Paramount Global, an investor could make an assessment about a stock's long term prospects using a moving average and trend line. If they believe a stock will remain above the moving average, which many believe is a bullish signal, they can extrapolate that trend into the future using a trend line. For Paramount Global, the 200-day moving average sits at $14.56, according to Benzinga Pro, which is above the current price of $13.09. For more on charts and trend lines, see a description here.

Traders believe that when a stock is above its moving average, it is a generally bullish signal, and when it crosses below, it is a more negative signal. Investors could use trend lines to make an educated guess about where a stock could trade at a later date if conditions remain stable.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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