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Paramount Global (PARAA)
NASDAQ:PARAA

Paramount Global (PARAA) AI Stock Analysis

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Paramount Global

(NASDAQ:PARAA)

Rating:53Neutral
Price Target:
$23.50
▲(2.17%Upside)
Paramount Global's overall score is primarily affected by financial performance challenges, including declining revenue and high leverage. Positive earnings call sentiment and technical analysis provide some offsets, but valuation concerns and financial instability weigh heavily on the overall score.

Paramount Global (PARAA) vs. SPDR S&P 500 ETF (SPY)

Paramount Global Business Overview & Revenue Model

Company DescriptionParamount Global operates as a media and entertainment company worldwide. The company distributes a schedule of news and public affairs broadcasts, and sports and entertainment programming; acquires or develops, and schedules programming on the CBS Television Network that includes primetime comedies and dramas, reality, specials, kids' programs, daytime dramas, game shows, and late night programs; produces or distributes talk shows, court shows, game shows, and newsmagazines; owns and operates 29 broadcast television stations; and operates CBS Sports Network, a 24-hour cable channel that provides sports and related content, as well as streaming and cable subscription services. It also operates Paramount+, a digital subscription video on-demand and live streaming services; and creates and acquires programming for distribution and viewing on various media platforms, including subscription cable networks, subscription streaming, and premium and basic cable networks. In addition, the company develops, produces, finances, acquires, and distributes films. Paramount Global was formerly known as ViacomCBS Inc. and changed its name to Paramount Global in February 2022. The company was incorporated in 1986 and is headquartered in New York, New York. Paramount Global operates as a subsidiary of National Amusements, Inc.
How the Company Makes MoneyParamount Global generates revenue through several key streams. The primary source is advertising sales, which comes from its extensive portfolio of television networks and digital platforms. The company also earns substantial income from affiliate fees, which are payments made by cable and satellite providers to carry its channels. Content licensing is another significant revenue stream, where the company licenses its vast library of films and TV shows to various platforms, including international broadcasters and streaming services. Additionally, Paramount Global has been expanding its direct-to-consumer offerings, with subscription-based streaming services contributing to its earnings. Partnerships and collaborations with other media companies and content creators further enhance its revenue potential by expanding its distribution and audience reach.

Paramount Global Earnings Call Summary

Earnings Call Date:May 08, 2025
(Q1-2025)
|
% Change Since: 2.31%|
Next Earnings Date:Jul 31, 2025
Earnings Call Sentiment Positive
The earnings call highlighted positive growth in revenue, subscribers, and content engagement, particularly in Paramount+ and film entertainment. However, there were challenges in digital advertising revenue and affiliate revenue declines, with expectations of subscriber decline in Q2. Despite these challenges, the company remains optimistic about future growth and profitability.
Q1-2025 Updates
Positive Updates
Revenue Growth and Cash Flow
Total company revenue grew 2% year-over-year excluding the Super Bowl, and the company generated $123 million of free cash flow.
Paramount+ Subscriber Growth
Paramount+ ended the quarter with 79 million global subscribers, up 11% year-over-year, with a revenue increase of 16% year-over-year.
Pluto TV Consumption Increase
Pluto TV delivered its highest consumption ever, with global viewing time up 26% year-over-year.
Film Entertainment Success
Sonic the Hedgehog 3 delivered box office sales of nearly $500 million, a franchise best, contributing to increased home entertainment and streaming performance.
Sports Viewership
CBS network audience grew 3% compared to last year, and streaming of CBS primetime shows on Paramount+ increased by 35%.
Negative Updates
Digital Advertising Revenue Decline
D2C advertising revenue declined 9%, with Pluto TV being the most affected due to increased digital video supply.
Affiliate Revenue Decline
Affiliate revenue declined 8.6% in the quarter, driven by subscriber declines and the impact of recent renewals.
Q2 Subscriber Decline Expected
The company expects Q2 subscribers to decline due to content seasonality and the termination of an international hard bundle partnership.
Company Guidance
During Paramount Global's Q1 2025 earnings call, the company highlighted several key metrics indicating strong performance and strategic direction. Total company revenue grew 2% year-over-year, excluding the Super Bowl, with D2C OIBDA improving by nearly $180 million and free cash flow reaching $123 million. Paramount+ saw an 11% increase in global subscribers, totaling 79 million, and a 16% rise in revenue, while churn improved by 130 basis points. The platform's global watch time per user also increased by 17% year-over-year. The company plans to maintain its profitability momentum in Paramount+ domestically for the year. In the TV media segment, advertising revenue, excluding the Super Bowl, remained flat year-over-year, supported by strong sports demand, while CBS network audience grew 3% in the quarter. Paramount continues to focus on content investment, with initiatives like expanding the Yellowstone franchise and successful releases like Sonic the Hedgehog 3 and Gladiator 2. Despite challenges in the macro environment, the company is prioritizing key investments and managing non-content expenses to sustain growth and profitability.

Paramount Global Financial Statement Overview

Summary
Paramount Global faces significant financial challenges, with declining revenue and profitability, negative net income, and increasing leverage. While the balance sheet shows a reasonable equity ratio, cash flow trends are weakening, indicating a need for operational improvements.
Income Statement
45
Neutral
Paramount Global's income statement shows declining revenue, with a notable decrease from $30.15 billion in 2022 to $28.72 billion in TTM. Gross profit margin decreased from 34.19% in 2022 to 32.23% in TTM, indicating pressure on profitability. The net profit margin turned negative, indicating losses, with TTM net income at -$5.32 billion. The EBIT and EBITDA margins are also negative, reflecting operational challenges.
Balance Sheet
50
Neutral
The balance sheet presents high leverage, with a debt-to-equity ratio of 0.94 in TTM, indicating significant debt relative to equity. Stockholders' equity decreased over the periods, impacting stability. However, the equity ratio remains reasonable at 36.44% in TTM, suggesting moderate asset coverage by equity.
Cash Flow
55
Neutral
Cash flow analysis indicates a decline in free cash flow, dropping from $489 million in 2024 to $403 million in TTM. The operating cash flow to net income ratio is positive, at 0.13, despite negative net income. This suggests operating activities generate sufficient cash, but overall cash flow trends are weakening.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue28.72B29.21B29.65B30.15B28.59B25.29B
Gross Profit9.26B9.78B7.26B10.31B10.84B10.29B
EBITDA-4.41B-4.92B85.00M2.60B4.39B15.62B
Net Income-5.32B-6.19B-608.00M1.10B4.54B2.42B
Balance Sheet
Total Assets45.40B46.17B53.54B58.39B58.62B52.66B
Cash, Cash Equivalents and Short-Term Investments2.67B2.66B2.46B2.88B6.27B2.98B
Total Debt15.53B15.55B15.86B17.27B19.31B21.32B
Total Liabilities28.47B29.39B30.49B34.79B35.65B36.61B
Stockholders Equity16.54B16.32B22.53B23.04B22.40B15.37B
Cash Flow
Free Cash Flow403.00M489.00M147.00M-139.00M599.00M1.97B
Operating Cash Flow672.00M752.00M475.00M219.00M953.00M2.29B
Investing Cash Flow165.00M12.00M942.00M-526.00M2.40B56.00M
Financing Cash Flow-553.00M-507.00M-1.84B-2.98B-152.00M-90.00M

Paramount Global Technical Analysis

Technical Analysis Sentiment
Positive
Last Price23.00
Price Trends
50DMA
22.63
Positive
100DMA
22.61
Positive
200DMA
22.41
Positive
Market Momentum
MACD
0.11
Negative
RSI
55.45
Neutral
STOCH
82.61
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PARAA, the sentiment is Positive. The current price of 23 is above the 20-day moving average (MA) of 22.75, above the 50-day MA of 22.63, and above the 200-day MA of 22.41, indicating a bullish trend. The MACD of 0.11 indicates Negative momentum. The RSI at 55.45 is Neutral, neither overbought nor oversold. The STOCH value of 82.61 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PARAA.

Paramount Global Risk Analysis

Paramount Global disclosed 42 risk factors in its most recent earnings report. Paramount Global reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Paramount Global Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
81
Outperform
$23.61B13.6416.89%0.98%15.70%26.73%
79
Outperform
$548.83B60.9440.84%14.11%47.22%
DIDIS
78
Outperform
$221.41B25.158.75%0.81%5.33%431.28%
75
Outperform
$12.92B-4.34%17.30%81.72%
61
Neutral
$40.70B-0.98-11.97%3.93%2.03%-69.70%
WBWBD
59
Neutral
$27.26B-27.69%-5.58%-254.85%
53
Neutral
$8.88B-28.56%0.87%-4.50%-898.86%
* Communication Services Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
PARAA
Paramount Global
23.00
1.89
8.95%
DIS
Walt Disney
121.82
25.69
26.72%
NFLX
Netflix
1,275.31
597.66
88.20%
ROKU
Roku
88.14
26.77
43.62%
FOXA
Fox
55.09
20.17
57.76%
WBD
Warner Bros
11.41
4.09
55.87%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 01, 2025