Entertainment giant Paramount Skydance (PSKY) may be about to conclude a major merger with Warner Bros. Discovery (WBD), but it turns out that the former frontrunner in that race, Netflix (NFLX), may be trying to throw a wrench in the works. Reports suggest Netflix has been pursuing a shutdown of the merger through regulatory channels. The news did not hurt Paramount stock much, as shares gained nearly 2% in the closing minutes of Wednesday’s trading.
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Reports suggest that Netflix may have had something to do with the Block the Merger campaign featuring over 4,000 signatures from a wide range of Hollywood. Actors, writers, and more came together to sign, and Netflix could have been involved. Netflix, for its part, denies any such involvement.
Moreover, reports note, a “senior government official” noted that Netflix has, or its representatives have, been calling frequently to seek licensing conditions included as part of the merger. The official in question noted, “Frankly, I am surprised at how aggressive they’ve been with me.” Most believe that any such action on Netflix’s part is done in a bid to limit potential competition. After all, Netflix may be the streaming leader, but HBO MAX was not far behind. With Paramount+ added on to it, that could make for very serious competition.
More About the Short-Form
We heard about Paramount’s plans to branch out into short-form content not long ago, but new information has emerged about what that may look like. Reports suggest that interactivity will also be a part of the short-form experience, including polls and sports statistics added to the short clips.
Those who thought that user-generated content (UGC) might be a factor here, though, had their hopes dashed. Paramount has no plans to add UGC to the platform, at least not “for now.” But the project remains, in the near term, and will serve as a marketing tool. The overall priority is that it is “…cheap and brings eyes to Paramount.”
Is Paramount Stock a Good Buy Right Now?
Turning to Wall Street, analysts have a Moderate Sell consensus rating on PSKY stock based on five Holds and five Sells assigned in the past three months, as indicated by the graphic below. After a 3.66% rally in its share price over the past year, the average PSKY price target of $11.38 per share implies 3.52% downside risk.
