Entering text into the input field will update the search result below

Brean: Paramount sale would signal Viacom re-merger roadmap

Aug. 29, 2016 10:47 AM ETViacom Inc. (VIA-OLD) StockVIA-OLD, VIAB, PARABy: Jason Aycock, SA News Editor1 Comment
  • Philippe Dauman's last stab at selling some part of Paramount Pictures is a key catalyst that likely indicates the fate of parent Viacom (VIA +0.6%, VIAB +0.3%) as a stand-alone company, Brean Capital says.
  • With Dauman's non-executive chairmanship ending in two weeks, he has a last effort to sell a stake or all of the venerable (but struggling) studio. He was said to be discussing a sale of 49% of Paramount to China's Dalian Wanda Group for around $4B, though Sumner Redstone (in control of voting power at Viacom) reportedly opposes such a move.
  • A merger hangs in the balance of that transaction, says Brean's Alan Gould. If the board goes for such a deal, it's an indication that it will "leave Viacom as a standalone company and the stock will go down and CBS will go up. If the Board does not approve the transaction, then we view that as an indication that the Board will try to remerge CBS and VIA which would be positive for VIA shares and near-term negative for CBS."
  • Assuming such a re-merger, the firm has an upside target for VIAB of $46, 11.5% upside from current pricing. As a stand-alone, Brean sees VIAB at $38, implying 7.9% downside.
  • As for CBS, Brean has a Buy rating and a price target of $51.44 (where the stock is trading at currently).
  • Alan Gould ranks No. 1,547 off 4,127 analysts rated at TipRanks.
  • Previously: Viacom: Pressure mounts on underperforming Paramount (Aug. 24 2016)

Recommended For You

Related Stocks

SymbolLast Price% Chg
VIA-OLD--
Viacom Inc.