Paramount Global shares jump after Warren Buffett’s Berkshire Hathaway increases stake

Paramount Global shares jump after Warren Buffett’s Berkshire Hathaway increases stake


In this photo illustration, the Paramount Global logo is displayed on a smartphone screen.

Rafael Henrique | SOPA Images | Lightrocket | Getty Images

Paramount Global‘s stock got a boost Tuesday after Warren Buffett’s Berkshire Hathaway upped its stake, a fresh signal that the media and entertainment company could be an acquisition target.

Berkshire disclosed in public filings late Monday that it now owns more than 91 million shares in Paramount. Buffett’s firm first disclosed its new stake in Paramount in May.

Paramount’s stock closed more than 5% up at $19.44 on Tuesday.

The increased position makes Berkshire the largest outside investor of Paramount’s class B shares at around 15%, or worth about $1.7 billion, as of Monday’s closing price, Wells Fargo & Co. analyst Steven Cahall said in a note.

Paramount is controlled through its class A shares by National Amusements, chairman Shari Redstone’s holding company.

The disclosure of the initial stake had a similar affect on Paramount’s share in May.

Paramount owns “Top Gun: Maverick” movie studio Paramount Pictures, as well as the broadcast network CBS, cable channels including MTV and VH1, the premium network Showtime, and fledgling streaming service Paramount+.

The company reported earlier this month that Paramount+, its answer to other premium streaming services like Netflix and Disney+, added 4.6 million subscribers, bringing its total to 46 million customers.

KeyBanc Capital Markets said in a research note Tuesday that it interprets Berkshire’s increased position as a sign that the firm either believes Paramount will be successful in the streaming wars, or that it’s a likely acquisition target.

“We believe a more realistic outcome is Paramount is acquired by a competitor,” KeyBanc said in Tuesday’s research note, citing likely buyers as technology or media companies that could use Paramount’s film studio and library to become a top competitor.

Paramount had missed analyst expectations when it reported its third-quarter earnings earlier this month, with its quarterly revenue dropping 5% compared to the prior year as it continued to suffer from cord cutting and falling advertising revenue.

In particular the company noted that its advertising revenue was down as macroeconomic headwinds began to hit. The media industry is bracing for a downturn in advertising. Earlier on Tuesday Warner Bros. Discovery CEO David Zaslav said the ad market is weaker now than at any point during the coronavirus pandemic-caused slowdown of 2020.



Source

Candy giant Ferrero adds American twists to Nutella, Ferrero Rocher to fuel U.S. growth
Business

Candy giant Ferrero adds American twists to Nutella, Ferrero Rocher to fuel U.S. growth

Containers of Nutella hazelnut spread made by the Ferrero company is displayed on March 27, 2024 in San Anselmo, California.  Justin Sullivan | Getty Images News | Getty Images Ferrero North America is adding peanuts to its Nutella, turning its Ferrero Rocher spheres into squares and adding Dr Pepper flavor to Tic Tacs, all in […]

Read More
Bill Gates doubles giving to 0 billion, says philanthropists can’t cover government cuts
Business

Bill Gates doubles giving to $200 billion, says philanthropists can’t cover government cuts

Bill Gates arrives for a press conference to launch the Global Polio Eradication Initiative at the European Commission’s Berlaymont headquarters in Brussels on October 11, 2023. Simon Wohlfahrt | Afp | Getty Images Billionaire Bill Gates announced on Thursday that he will double his charitable giving to $200 billion over the next 20 years. In […]

Read More
Krispy Kreme stock plunges after doughnut chain pauses McDonald’s rollout, pulls outlook
Business

Krispy Kreme stock plunges after doughnut chain pauses McDonald’s rollout, pulls outlook

Justin Sullivan | Getty Images News | Getty Images Krispy Kreme stock plunged 24% on Thursday morning after the doughnut chain said it is “reassessing” its rollout with McDonald’s and pulled its full-year outlook in part due to economic “softness.” Krispy Kreme is not planning to launch its doughnuts in any additional McDonald’s locations in […]

Read More