So remember yesterday, when a whole bunch of celebrities basically set their careers on fire by coming out against the deal between entertainment giant Paramount Skydance (PSKY) and Warner Bros. Discovery (WBD)? Apparently, it got worse, as the theaters are now coming out against the deal. Apparently investors are sensing a win with all this, because they sent Paramount shares up over 3% in the closing minutes of Tuesday’s trading.
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Michael O’Leary, the current chair of Cinema United, made it clear that theater owners were very much against the merger between Paramount and Warner, and would continue their opposition throughout the process. O’Leary called the entire deal “…harmful to exhibition, consumers and the entire entertainment ecosystem.” The reason was basically the standard at this point: fewer distributors mean less competition and, therefore, more favorable terms for distributors.
O’Leary noted that his group was calling for longer theatrical distribution windows as well, looking to go to at least 45 days. In 2025, the average theatrical window for the top 100 films stood at 37 days, reports noted. But if those releases had had a 45-day window each, the average would have increased to 49 days, making it clear that theatrical windows mean good business.
Paramount Responds
But Paramount did not let all the opposition to its deal go quietly unanswered. Paramount offered all the best in platitudes, emphasizing its “…commitment to supporting and growing creative talent.” Keeping one eye out for regulators, Paramount also reiterated that the merger would strengthen competition, despite the fact that one entire distributor would be off the field altogether.
Paramount again noted its commitment to bringing out at least 30 feature films with theatrical releases, and to continue to license content and maintain brands. All of these things sound reasonable until you start looking closely at the details, which have been noticeably quiet these last few weeks. The concerns, therefore, are that the brass tacks of the deal are not so much brass as they are painted tin.
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 1.2% loss in its share price over the past year, the average PSKY price target of $11.38 per share implies 2.71% upside potential.
