Paramount moves add to ‘M&A narrative,’ says Wells Fargo

Wells Fargo says Paramount Global’s recent announcements on severance and change in control as well as the Bellator sale “adds to the M&A narrative.” However, Wells is skeptical there’s a more drastic change in strategy coming and notes the company’s fiscal 2024 net leverage is four-times pro-forma. Nonetheless, Paramount took two steps forward to suggest a takeover is in play, the analyst tells investors in a research note. The firm believes there is value in a breakup via the value unlock of studios, but does not see this strategy emerging with Paramount’s divestitures limited to marginal businesses. It keeps an Underweight rating on the shares with a $12 price target.