These are top 10 stocks traded on the Robinhood UK platform in July
On Wednesday, Deutsche Bank (ETR:DBKGn) adjusted its stance on Paramount Global (NASDAQ: PARA), downgrading the stock from Buy to Hold and lowering the price target to $12.00 from the previous $15.00. The stock, currently trading at $11.68, has shown significant volatility this year with a 52-week range of $9.54 to $14.54. According to InvestingPro data, the stock has gained about 13% over the past six months, despite challenging market conditions. Bryan Kraft, an analyst at Deutsche Bank, cited a reduction in EBITDA estimates for the years 2025 to 2027 by 8-10% as the primary reason for the downgrade. The revised estimates reflect an increasingly cautious view of the company’s financial outlook. Current EBITDA stands at $2.92 billion, while InvestingPro analysis shows the company maintains a "Fair" overall financial health score, with particularly strong ratings in price momentum and relative value metrics.
Kraft explained the rationale behind the downgrade, noting that the potential for Class B shareholders to sell up to half their shares at $15 each had initially presented an appealing value. This would have left the remaining shares, or "stub," trading at an estimated 5 times the projected 2025 EBITDA. However, with the updated EBITDA forecasts and the stock price reaching its highest point since the merger deal announcement in July, the risk/reward balance has shifted.
The analyst pointed out that the current stock price does not offer the same attractive entry point as before. The reassessment comes as the stock trades at peak levels, which has altered the investment outlook. Kraft also mentioned the broader context of the media industry and its evolution over the past nine months since the merger agreement. He expressed uncertainty about how Skydance’s plans and targets may have changed in response to these industry developments.
Adding to the concerns, Kraft highlighted the increasing risk to the advertising outlook, which is being impacted by macroeconomic factors. These factors could potentially affect Paramount Global’s revenue streams and overall financial performance.
Deutsche Bank’s revised price target of $12.00 reflects these updated projections and the new Hold rating signifies a neutral stance on the stock’s potential for growth or decline in the near term. Paramount Global’s stock movement will continue to be watched closely by investors as the company navigates the evolving media landscape and macroeconomic challenges. InvestingPro analysis suggests the stock is currently undervalued based on its Fair Value model, with analysts’ targets ranging from $9 to $20 per share. Discover more detailed insights and 12+ additional ProTips about Paramount Global in the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.
In other recent news, Paramount Global reported its fourth-quarter 2024 earnings, revealing a miss on both earnings per share (EPS) and revenue forecasts. The company posted an EPS of $0.11, falling short of the expected $0.20, with revenue reported at $7.98 billion, below the forecasted $8.11 billion. Despite these challenges, Paramount+ added 5.6 million subscribers, bringing the total to 77.5 million, and generated $489 million in free cash flow. In terms of mergers, PlayOn announced the acquisition of MaxPreps from CBS Sports, a division of Paramount Global, aiming to enhance high school sports experiences. Analyst ratings for Paramount Global varied, with UBS maintaining a Sell rating and a $11.00 price target, citing potential declines in TV affiliate numbers and EBITDA challenges. Meanwhile, Benchmark maintained a Buy rating with a $19.00 price target, expressing optimism about Paramount’s upcoming deal with Skydance, which could bring additional synergies and financial strength. These recent developments reflect the dynamic landscape Paramount Global is navigating, with both challenges and opportunities on the horizon.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.