Paramount Global (PARAA) AI Stock Analysis

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Paramount Global

(NASDAQ:PARAA)

Rating:51Neutral

Price Target:

$22.50

▲(0.13%Upside)

Paramount Global's stock score reflects significant financial performance challenges, including declining revenue and profitability. Despite positive subscriber growth and strategic direction in its earnings call, technical indicators and valuation metrics suggest caution. The overall score is weighed down by financial difficulties and bearish technical signals.

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

Market Cap

$8.48B

Dividend Yield0.89%

Average Volume (3M)18.78K

Price to Earnings (P/E)―

Beta (1Y)0.51

Revenue Growth-4.50%

EPS Growth-898.86%

CountryUS

Employees18,600

SectorCommunication Services

Sector Strength79

IndustryEntertainment

Share Statistics

EPS (TTM)0.29

Shares Outstanding40,702,682

10 Day Avg. Volume15,346

30 Day Avg. Volume18,783

Financial Highlights & Ratios

PEG Ratio-0.15

Price to Book (P/B)0.55

Price to Sales (P/S)0.00

P/FCF Ratio-91.56

Enterprise Value/Market Cap3.20

Enterprise Value/Revenue0.23

Enterprise Value/Gross Profit2.93

Enterprise Value/Ebitda-1.48

Forecast

1Y Price TargetN/A

Price Target UpsideN/A

Rating ConsensusN/A

Number of Analyst Covering0

Paramount Global Business Overview & Revenue Model

Company DescriptionParamount Global (PARAA) is a leading global media and entertainment company that operates across various sectors including television, film, direct-to-consumer streaming, and digital content. The company is known for its iconic brands such as CBS, MTV, Nickelodeon, Paramount Pictures, and Showtime, offering a diverse range of entertainment options that cater to a wide audience. Paramount Global delivers its content through multiple platforms, ensuring broad accessibility and engagement with viewers worldwide.

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: -0.31%|

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

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

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

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.

TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
28.72B	29.21B	29.65B	30.15B	28.59B	25.29B
	Gross Profit
9.26B	9.78B	7.26B	10.31B	10.84B	10.29B
	EBIT
1.78B	-5.27B	-451.00M	2.34B	4.06B	4.14B
	EBITDA
-4.41B	-4.92B	85.00M	2.60B	4.39B	15.62B
	Net Income Common Stockholders
-5.32B	-6.19B	-608.00M	1.10B	4.54B	2.42B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
2.67B	2.66B	2.46B	2.88B	6.27B	2.98B
	Total Assets
45.40B	46.17B	53.54B	58.39B	58.62B	52.66B
	Total Debt
15.53B	15.55B	15.86B	17.27B	19.31B	21.32B
	Net Debt
12.85B	12.89B	13.40B	14.39B	13.04B	18.33B
	Total Liabilities
28.47B	29.39B	30.49B	34.79B	35.65B	36.61B
	Stockholders Equity
16.54B	16.32B	22.53B	23.04B	22.40B	15.37B
Cash Flow		Free Cash Flow
403.00M	489.00M	147.00M	-139.00M	599.00M	1.97B
	Operating Cash Flow
672.00M	752.00M	475.00M	219.00M	953.00M	2.29B
	Investing Cash Flow
165.00M	12.00M	942.00M	-526.00M	2.40B	56.00M
	Financing Cash Flow
-553.00M	-507.00M	-1.84B	-2.98B	-152.00M	-90.00M

Paramount Global Technical Analysis

Technical Analysis Sentiment

Negative

Last Price22.47

Price Trends

50DMA

22.57

Negative

100DMA

22.61

Negative

200DMA

22.37

Positive

Market Momentum

MACD

-0.03

Positive

RSI

46.29

Neutral

STOCH

54.04

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PARAA, the sentiment is Negative. The current price of 22.47 is below the 20-day moving average (MA) of 22.57, below the 50-day MA of 22.57, and above the 200-day MA of 22.37, indicating a neutral trend. The MACD of -0.03 indicates Positive momentum. The RSI at 46.29 is Neutral, neither overbought nor oversold. The STOCH value of 54.04 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative 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
FOXA	81 Outperform	$23.18B	13.35	16.89%	1.00%	15.70%	26.73%
DIS	78 Outperform	$214.87B	24.41	8.75%	0.84%	5.33%	431.28%
NFLX	76 Outperform	$519.15B	57.41	40.84%	―	14.11%	47.22%
ROKU	64 Neutral	$11.80B	―	-4.34%	―	17.30%	81.72%
WBD	63 Neutral	$26.00B	―	-27.69%	―	-5.58%	-254.85%
Sector *	61 Neutral	$14.64B	5.81	-3.99%	6.03%	2.71%	-31.56%
PARAA	51 Neutral	$8.48B	―	-28.56%	0.89%	-4.50%	-898.86%

* Communication Services Sector Average

Performance Comparison

PARAA

Paramount Global

22.47

5.23

30.34%

DIS

Walt Disney

117.94

17.33

17.22%

NFLX

Netflix

1,212.15

536.32

79.36%

ROKU

Roku

74.41

20.44

37.87%

FOXA

Fox

53.69

20.63

62.40%

WBD

Warner Bros

10.03

2.87

40.08%

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.