Paramount Global Is Too Small To Win Streaming Wars Against Amazon, Disney, And Netflix, Analyst says

  • Needham analyst Laura Martin reiterated a Buy rating on the shares of Paramount Global PARA with a price target of $28.
  • At a $15 billion market cap, the company is too small win in the streaming wars against Amazon.Com, Inc. AMZNWalt Disney Company DIS and Netflix, Inc. NFLX, said the analyst.
  • If it is being sold, Paramount would garner a 20% - 40% premium to today's valuation, the analyst noted.
  • The analyst thinks the company has asset values that are not accurately reflected in its financial statements, but would be paid for upon exit.
  • One of the things the analyst likes most about PARA is its complementary revenue streams. 
  • The analyst noted that its global linear TV networks have the best economics in the media business.
  • The analyst said films give PARA access to the wealthiest consumers and hit films create an engine that drives upside to subsequent windows of distribution, including its captive DTC services. 
  • The analyst believes PARA's CFO is committed to material cost reductions that will benefit FY23 and FY24. 
  • Price Action: PARA shares are trading lower by 2.9% at $21.50 on the last check Friday.
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