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Wall Street analysts remained unimpressed after Paramount Skydance delivered a weak third-quarter earnings report, its first as a merged company. In its last quarter, Paramount reported a loss of 12 cents per share, combining both pre- and post-merger results. Analysts polled by LSEG had expected a profit of 38 cents per share. The company's $6.70 billion revenue also fell short of the forecast $6.97 billion. But shares of the company were last trading 10% higher on Tuesday. Traders appeared to be reacting to Paramount's plans to cut more costs and lay off additional employees. Simultaneously, it announced that it would raise prices for its streaming service next year. PSKY 5D mountain PSKY 5D chart Still, analysts seemed unsatisfied, with most maintaining their bearish to neutral stances on the company, as they see a challenging path ahead to turn around the business. According to LSEG, only two analysts who cover the company rate it a buy. The majority are at a hold, with two having a sell and six at underperform, it said. Here's what some of Wall Street's biggest shops had to say following the earnings report. Barclays: Underperform rating, $8 price target The bank's price target implies about 48% downside from Paramount Monday's close of $15.25. "Management focus appears to be on rebuilding the machine from the ground up to improve execution, which could be a real long-term value creation opportunity, but will not be a straight line with respect to P & L and cash flow; In the interim, valuation focus will remain on asset portfolio changes. … We believe any potential deal with [ Warner Bros Discovery ] would likely involve a significant cash component which PSKY's existing balance sheet cannot support. These factors would imply a potential further capital infusion as a result of which, a valuation framework for the stock is likely to remain in flux till there is some resolution on corporate actions." Morgan Stanley: Underweight, $10 Morgan Stanley's forecast corresponds to downside of around 34%. "The 3Q results and guidance take a backseat to the longer-term ambitions of new management and the continued unconfirmed market reports of a possible WBD acquisition. The new team has a clear plan, but faces the same questions of streaming scalability and linear headwinds that have weighed on the sector." UBS: Sell, $12 UBS' target calls for 21% downside going forward. "We continue to value the company based on 7x EBITDA. This sits at the high-end of the peer group, including WBD (closest peer in terms of asset mix) at ~7x 2026E EBITDA pre PARA bid chatter, [ Fox Corp. ] at 6.3x and [ AMC Networks ] at 5.0x, which we believe is fair given studio ownership and the near-term synergy ramp/EBITDA growth. Once all the dust settles, the multiple will likely depend on how quickly the company can ramp its streaming business and overcome the drag from legacy assets." Bank of America: Underperform, $13 Analyst Jessica Reif Ehrlich's forecast, up from $11, is 15% above Paramount's Monday closing price. "On a consolidated basis, results were largely mixed although streaming profitability was ahead of our forecast (not perfectly comparable to our forecast due to reporting changes). More importantly, the company provided a 2026 outlook, which calls for revenue of $30bn and adjusted [operating income before depreciation and amortization] of $3.5bn (which was above our $3.1bn forecast) driven in large part by the increase in run-rate synergies (~$2.5bn by end of '26; $3bn in total). All said, it is clear PSKY has a very strong management team and there will be upward estimate revisions post results. However, there are still many unknowns on the strategic initiatives the company has undertaken and, as evidenced by prior large combinations, restructurings often take years to implement." JPMorgan: Underweight, $14 Analyst David Karnovsky's price target was approximately 8% lower than Paramount's closing price on Monday. "While we're encouraged by PSKY's vision, there remains a significant amount of execution across [direct to consumer] and Filmed Entertainment, the benefits of which may not be visible until later in 2026. We look forward to learning more, but remain Underweight, cautious of the near-term cash outflows and still long-term risks at TV Media." Citi: Neutral, $17 Citi's target equates to 11% upside. "Paramount reported revenue and EPS below expectations while Adj. OIBDA beat Street estimates. The company also gave 2026 guidance, which missed expectations on revenue but beat Adj. [operating income before depreciation and amortization] due to higher than expected expense synergies. As such, we would not be surprised to see shares trade higher … given the beat." Wells Fargo: Equal weight, $18 The bank's price target implies upside of 18%. "PSKY mgmt provided a thoughtful battle plan to transform the company. Savings are big, & mostly redeployed into content/tech. P+'s evolution will be the best judge of success. We increase our PT to $18 on higher ests., & incl. a pro forma for WBD."
