“Expected Mass Layoffs”: Paramount Stock (NASDAQ:PARA) Slips as CBS News Pares Staff

For a while, one thing most believed about entertainment giant Paramount (PARA) was that CBS, and CBS News by extension, was safe from layoffs ahead of the merger with Skydance. But a new report from the New York Post makes it clear: that is not the case. In fact, CBS News “…quietly trims staff” before what is expected to be another round of “mass layoffs.” to hit this summer. The move was bad news to investors, though, as shares slipped fractionally in the closing minutes of Friday’s trading.

We wondered yesterday if George Cheeks, CBS boss, might have been the weak link in all this, and this suggests he may have larger problems than expected. CBS News fired three people described as being in “high-level positions”, including “…two CBS News bureau chiefs and a senior executive.” Both North Bureau Chief Andre Rodriguez and Southern Region Bureau Chief Maryhelen Campa were cut as a result. The senior executive, meanwhile, was Chad Cross, Beats & Enterprise unit senior vice president.

The firings were “a streamlining move,” reports noted, and seem to be part of “…organizational changes to centralized the internal newsgathering process.” This was not “…an indication of something bigger,” the reports noted. However, insiders at the network revealed the network has “no fat left to cut,” and that “…if someone calls in sick, everyone feels it.”

Mission: Impossible Coming to China

Better, and lighter, news for Paramount also emerged, as Paramount secured a release date for Mission: Impossible—The Final Reckoning in theaters in China. The title will hit Chinese theaters May 30, reports note, as the Beijing government put out a wave of approvals for American films to show in Chinese theaters.

While there were noises from Beijing before about cutting back on the number of American films allowed into the country—the government back in April noted it would “moderately reduce” the number in question—but most major releases seem to be going through. Universal’s (CMCSA) How to Train Your Dragon live-action remake, along with Disney’s (DIS) Lilo & Stitch both got the green light as well.

Is Paramount Stock a Good Buy Right Now?

Turning to Wall Street, analysts have a Moderate Sell consensus rating on PARA stock based on two Buys, seven Holds and six Sells assigned in the past three months, as indicated by the graphic below. After a 1% loss in its share price over the past year, the average PARA price target of $12 per share implies 2.26% upside potential.

See more PARA analyst ratings

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