Paramount downgraded to Sell at Seaport on strategy questions post deal close

Seaport Research downgraded Paramount (PARAA) (PARA) to Sell from Neutral with an $11 price target on B shares, which the firm notes will trade under the ticker symbol “PSKY” after August 7 following the closing of the Skydance merger. Ahead of the merger closing, the firm is reducing its “too-robust” advertising and filmed entertainment estimates for Q3 and beyond, noting that it still sees upside in the short-term, but sees risk that shares could give back some of the deal-related upside post-tender. The firm also sees questions surrounding the go-forward strategy post-close and tender, adds the analyst, who has a $17 price target on Paramount A shares, whose holders will receive cash or 1.533 PSKY shares upon deal closing.