By Michael Elkins
A Goldman Sachs analyst downgraded Paramount Global (NASDAQ:PARA) from Buy to Sell with a price target of $20.00 (from $37.00), sending shares down 4% in intra-day trading Tuesday. The analyst believes macro headwinds are likely to intensify pressures on EBITDA and FCF. He believes that the pressure may continue through "at least 2023" and will increase the risks for the company as it executes its streaming strategy.
The analyst was clear that Goldman Sachs has not changed its view that PARA's rich IP and scaled content production assets could support a sizable streaming business, over time. However, he believes that the market is unlikely to underwrite this long-term potential as the near-term operating environment becomes more difficult.
Shares of Paramount Global closed at $25.34 yesterday and last traded at $24.30 on Tuesday.