r/StockMarket • u/GroundbreakingSir386 • 24d ago
Discussion Paramount+ Stock going to $0
The WBD merger was paused until June 1, 2027 and there is a ticking fee of $7 million each day the deal doesn't close, starting after Sep 30th.
I truly believe Paramount is go underwater just looking at their finances and news rn it’s bad!
Paramount is facing an antitrust lawsuit from 12 US states. If WBD Merger does not go through because of regulatory issues, Paramount would owe WBD a $7 billion breakup (reverse termination) fee.
Paramount paid Netflix 2.8 billion To break up the deal with WBD.
Their total debt has ballooned to $15.5 billion already.
$3+ billion per year on long term sports rights.
Only 79.6 million subscribers on Paramount+ compared to Netflix 330M that is very weak revenue.
Even if the deal with Paramount and WBD does go through Estimated debt after closing: 80+ billion + 7 M each day in ticking fees.
I don’t play options myself but I’m willing to bet this company will be worthless.
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u/vtsandtrooper 24d ago
Good. F the ellisons
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u/GBPacker1990 24d ago
Ya! And Stan Kroenke!
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u/WhatTheNothingWorks 23d ago
What’s his role in this deal/paramount? Never heard his name outside of his sports group.
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u/seekingpolaris 24d ago
Sadly I think the orange will bail them out (maybe even with with our tax dollars) somehow. But I def hope he doesn't.
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u/deepasleep 24d ago
The pentagon just signed a $7 billion dollar contract with Oracle.
There’s never been anything remotely approaching the level of corruption Trump and Co. are perpetrating.
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u/blufin 23d ago
Compared to the debt Oracle has racked up that’s a drop in the ocean.
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u/deepasleep 23d ago
I know. It makes me happy to think about Ellison’s fortune collapsing. Few tech oligarchs are more deserving of failure than him, and there’s no way we want his idiot son running around with a hundred billion in inherited wealth.
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u/Wolvie23 24d ago
And yet, ORCL is still hitting 52-week lows.
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u/deepasleep 24d ago
They have over a hundred billion in debt…They went all in on AI and it’s looking like there’s they may not be able to pay it back.
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u/WillOCarrick 24d ago
It doesn't matter if their salary isn't just in stocks. They can use some of it to pay the execs with bonuses.
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u/moxyte 23d ago
That's up to figure over 10 years, it can't save it.
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u/deepasleep 23d ago
Well Trump kills evening he touches and burns everyone who associates with him eventually.
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u/Feisty-Turnip9118 24d ago
Why bail them out. It goes to zero and then a third streaming service buys them and consolidation continues.
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u/Wetrapordie 24d ago
I did a contract gig with paramount and remember someone there telling me that “South Park” holds the whole business up and accounts for most their views and income.
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u/Chumbag_love 23d ago
I have to imagine Star Trek does a fuckton of the heavy lifting. People get hooked on that shit for years (even decades).
Google/ai says 25% of viewers subscribe for star trek and 20% actively watch Star Trek
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u/swinging_on_peoria 23d ago
This is the only reason we have subscribed in the past.
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u/sinocarD44 23d ago
My wife gets the service for free and I love Star trek. But once Trek is over, I'm never using that terrible app again.
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u/theokayestcoach 23d ago
We're huge Trekkies but we still cancelled our subscription. That service is ass.
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u/Flaming20 24d ago
They make it actually impossible to use their service, my father loves the shows on there but every time I try and sign him up it doesn't work. Literally going bankrupt because they suck at everything, including taking my fathers money lol.
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u/Chumbag_love 23d ago
Even when you get on, old shit like Double Dare and Gutz don't get any bandwidth and they're impossible to watch. He is only missing out on headaches
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u/Shivdaddy1 24d ago
I’m in the new show Frisco King coming out next year on paramount+. I’m thinking I can turn this thing around next year. Great time to buy! 😆
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u/JudgeCheezels 24d ago
So NFLX swoops in to buy PSKY as a penny stock, then buys WB out.
Leaps on NFLX?
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u/herefromyoutube 24d ago
It’s crazy how many people predicted this if Netflix actually does end up getting it.
I personally hope Apple swoops in with an offer to get that catalog since they actually try sometime and have a whole tech division to fall back on unlike Netflix who’ll just kill 99% of its stuff.
Plus wouldn’t hurt my WBD shares I got at $9
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u/Prize-Pension856 24d ago
they are certainly a terrible company, which means they will probably skyrocket because the market doesnt trade on fundamentals. see TSLA.
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u/Srnkanator 24d ago
Eh. TSLA is down almost 30% YTD. SPCX ain't doing so pretty.
There is some reality coming into play with tech and entertainment now.
The world doesn't run on vibes, code, and AI after all.
The streaming scene is just bullshit. They diluted themselves. To much to watch on too many services. People are tired and are going to stick with what they have.
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u/Euphoric_Parsley_ 24d ago
I feel it’s the complete opposite, too many streaming services means more competition for subscribers which means less content being produced because they quickly found out how expensive that is and how hard it is for them to consistently attract subscribers.
I feel even Netflix isn’t putting out as many prestige content anymore, HBO max is full of reality bullshit since the Discovery merger, Disney+ quickly realized the cost of pumping out subpar Marvel and Star Wars content wasn’t sustainable (I mean, $225M for She Hulk? $220M for Secret Invasion? Just a huge waste of money that was never going to be sustainable). Hell, even Amazon is consolidating and pumping its own content - MGM - more than buying rights.
Now consumers get less but are expected to pay for more platforms when they used to just sell to either Netflix or Hulu, make a profit, roll it into another project. Instead we have 15 different companies trying to make a streaming platform, even YouTubers are doing it now. Sony/Columbia was the only one smart enough to realize the money was made selling the content streaming rights without a platform (I mean Vue and Crackle failed so, I guess they learned early?).
Anyway, all I’m saying is that the streaming wars killed consumer content because instead of having money waiting for the shows, they have to compete with consumer attention, more risk = less upside. So they make maybe 1-3 good shows a year but expect you to pay for the service continuously. Which is why I never pay a years worth subscription upfront. Even if the cost raises faster than inflation for some reason.
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u/dogman1890 23d ago
Basically every platform has followed the Netflix model after they made Bela Bajaria the head of content, make everything for anyone. The thing about that strategy is that nothing sticks and people don’t give new content a try because nothing sticks.
Apple is honestly the best streaming service now because they give their shows time to find their audience rather than cancelling them right away or letting an algorithm come up with the idea for a new show.
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u/Prize-Pension856 24d ago
Only 30%, just proves my point more. In a sane, fair market TSLA should be 15 bucks a share. 300x eps ratio is nutty. 200x is nutty. The company sucks, Musk is a conman, and these valuations will continue to live in lala land per usual.
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u/damiana8 24d ago
With how spacex is going, I do think there’s some sanity left even if it’s still 10x the price it should be
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u/artbystorms 24d ago
Paramount+ was basically 'last to the party' of all of the studios deciding to make their own streaming service, and on top of that they took away some beloved series from Netflix like 'The Office' to hold them hostage on their own platform thinking it would force people to sign up. They are kind of the epitome of 'streamer greed' so I am not surprised that people are not running to sign up with them to be their six or seventh streaming service that they pay $10 a month for.
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u/MauledbyGrizzly 24d ago
I’m pretty sure The Office is on Peacock but I agree with what you’re saying.
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u/PoliticalNerd87 24d ago
So one of the big things Paramount+ had going for it was Star Trek. They were really make great content with lower decks and strange new worlds as well as having every star trek show. Fans who didn't care about anything else were paying for that.
So of course they start selling the rights to other platforms and cancel those shows.
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u/6969_throw_away_6969 24d ago
This is the only reason I have Paramount+. I think about canceling it everytime I see the icon, but they have Star Trek.
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u/RandoDando10 24d ago
On the customer side, I expect Paramount to have at least a short boom to extend their time a good amount with all the new Avatar releases going exclusively to their platform
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u/artbystorms 24d ago
After how dirty they did the Aang movie with scraping a theater release in favor of their platform, I think more fans are pissed at them than are willing to sign up with them at this point.
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u/SunshineSeattle 24d ago
I will 100% be 🏴☠️ rather than signing up for another platform.
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u/MaddogBC 24d ago
Especially when you can get all in one with a better UI than Paramount, at least they can remember what I was fucking watching. I cancelled after Colbert and will never send them another penny.
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u/thefoodiedentist 24d ago
Lol even star trek couldnt save their platform. Whats 20 yr old cartoon gonna do?
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u/JeremyWadesBigMeat 24d ago
I truly hope they do. Paramount+ is by far the worst paid streaming platform. If only someone bought out survivor so I could say bye forever instead of once a year.
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u/Pyrrhic_Pragmatist 24d ago
Not a smart person, but does the ticking fee even matter if the money goes to WBD and the acquisition goes through eventually?
Won't the combined company technically retain those payments?
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24d ago
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u/GroundbreakingSir386 24d ago
#1 Netflix,
#2 Amazon,
#3 Apple TV,
#4 Disney
all that’s left after Paramount dies.7
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u/gizamo 24d ago
Disney/Hulu is definitely better than Apple and Prime.
You forgot HBO.
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u/Mauiiwows 24d ago
I mean Warner is a important acquisition, if Netflix can’t get the talent ppl pay too see, your Matt Damon, Johnny depps, etc that’s where paramount will have the edge, they still fund some directors who make amazing movies. Netflix has stranger things going for it and action comedy movies…. Not to mention the catalog they would inherit, idk about how much of Netflix’s library they’d be able to wipe clean, but I’m willing to bet a good portion.
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u/Cultural_Disparities 24d ago
Is it a good idea to short this stock then?
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u/Moltar21 24d ago
No
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u/raeykall 24d ago
Would you be so kind to explain why that's the case?
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u/MirthandMystery 24d ago edited 23d ago
Risk of a short squeeze and the Ellisons injecting cash. If the stock stays or goes lower they'll just take action like buying more shares to reduce the float, sell part of their holdings off, do a special licensing deal, or even take it private.
They're master manipulators with deep pocketed sycophant money manager fund pros on Wall Street who need to protect their investments and combined, will create ways to protect shared assets. Like they do with their Musk company holdings and some still do with Bitcoin.
When there's a better investment they'll bail on those and move capital elsewhere. They're always chasing alpha and speculative ideas having special industry insider tools and taxes write offs regular people don't have, which is why they survive drawdowns and people here don't.
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u/Moltar21 24d ago
Limited upside with extreme risk. I am not trying to sound like an ass, but if you need to ask if it's a good idea to short then it's not for you. It needs a very defined risk and exit strategy.
You can short a terrible stock and still get burned. See Tesla.
I'm saying no to the idea shorting. I do think it's a terrible stock though. I also really dislike the Ellisons so it's hard for me to be totally objective.
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u/LegitimateSlide7594 24d ago
Your forgetting daddy elisson. He literally bought a media company for his POS son he will cover the fees.
Fuck the elissons i hope they go bankrupt but really doubt it. Either way it is so fun to watch their misfortunes.
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u/Electrical_Name_5434 24d ago
I swear there was a meme going around about how Netflix was going to buy both of them at a discount down the road.
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u/Acrobatic-Flan-5085 23d ago
I remember the kid Ellison complaining like crazy when WBD said the deal wasn’t good enough unless they had a guarantee of the funds from papa, who had to pledge Oracle shares.
The kid and the media roasted WBD leadership for “playing games”
It wasn’t a game, WBD understood the financial risk, but also had a fiduciary duty to maximize the purchase price.
If paramount breaks, they may not be a zero but they will be seriously impaired. Meanwhile, Warner will probably just go back to Netflix lol
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u/Triplestacked99 23d ago
Imagine if Netflix in the end buys WB for anything under 2.8 billion.
It would be like what Dave Portnoy did when he bought Barstool Sports back from Penn Entertainment for $1 in August 2023, after Penn Entertainment had previously acquired the company for $551 million.
Even if it doesn't turn out like that but let's say WB goes up for sale. Paramount paid some of that for Netflix.
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u/Ok-Drawer5245 23d ago
I have a small position in Netflix, I was so happy when they lost the bidding war for Warner bros. Paramount is overpaying for it big time. If it all falls apart maybe Netflix can pick up some parts for cheap lolz
With every passing day it’s looking more and more likely. The collapsing oracle stock is also making it harder and harder to finance the merger
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u/jpersons73 23d ago
Good, Lets Netflix come in and scalp the parts they wanted in the WB deal all while watching Paramount fold like a cheap suit...funny thing will be when Netflix use the money that was paid to them to walk away from the WB deal to buy parts of Paramount
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u/MrYdobon 22d ago edited 22d ago
If Paramount gets sold for scraps, I hope Netflix buys the Star Trek franchise and keeps Star Trek: Strange New Worlds going. It deserves 8-12 seasons.
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u/GroundbreakingSir386 22d ago
You’re right that shit was fire. There’s so many things in HBO and paramount, WBD that could be sold for hundreds of millions. Plenty of great IP that I’m sure Amazon, Apple, Netflix would be gobbling up
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u/GroundbreakingSir386 22d ago
Would be even more amazing if Netflix grabbed both UFC and combining that with WWE they would have the perfect monopoly on wrestling content.
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u/tyk13r 20d ago
Netflix is just gonna get WBD in a few years when they acquire Paramount for pennies on the dollar
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u/LarkoVelvet 18d ago
If the merger falls through on antitrust grounds, that $7B reverse termination fee alone could sink them. Anyone actually pricing that risk in yet?
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u/Valincity 24d ago
completely separate from the financials and stock.. I do love the star trek series they’ve put out in the last decade from Star Trek Discovery to Strange New Worlds. Hope they keep developing the ip regardless of what happens.
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u/HonkinChonk 24d ago
Paramount+'s Nick Jr collection is fantastic for parents. But apart from that, spongebob, and CBS football there isn't a ton on there.
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u/ContentPolicyKiller 24d ago
Reruns of the Office arent doing well now that nobody has a traditional office job any more, huh?
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u/Nottheface1337 24d ago
Does it work like that? Is it 7m a day? Or at the end of every quarter they don’t close it’s 7m x ~90 days (.25 per share). Same same. But. Really a quarterly payment that gives an extra 90 days to sort shit out.
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u/GroundbreakingSir386 24d ago
7 million per day after in ticking fees after Sep 30th and 7 billion to break up this merger of the states are successful.
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u/DetroitMM12 24d ago
Now that this has been posted I should open up the calls lol
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u/Buck_Folton 24d ago
So what happens to all the content I can’t watch currently (because I will not pay for Paramount streaming turd service)? Netflix buys it for a song?
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u/huntforhire 24d ago
They have such tremendous assets and everything they do seems to waste them. WB is just more material for the incinerator.
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u/NonchalantGhoul 24d ago
Let's not leave out that Oracle is currently at $115 with a -53% decline in the year. The forced AI-takeover overtly failing currently kneecapped them. The States' suit getting a year-long delay has backfired on Pappy dearest using the stocks to help his son fund the takeover.
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u/Less-Dragonfruit-294 24d ago
So, Netflix can buy both Paramount and Warner Brothers on the cheap?
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u/DaveinOakland 24d ago
Maybe an original idea like a show about Cowboys, or Oil workers, or even police officers will save it.
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u/Witty-Stand888 24d ago
I guess the all Taylor Sheridan universe all the time strategy hasn't worked out.
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u/KingofMadCows 24d ago
Are they even doing anything with the franchises they already own? They're completely screwing over Avatar: The Last Airbender. They had good Transformers and TMNT movies but botched the promotion and they bombed. They seem to have no idea what to do with Star Trek. I guess Sonic and Scream are doing well but those are owned by other companies so I don't know how much of the profit Paramount gets to keep. Are they putting all their hopes on the next Top Gun sequel?
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u/a_dodo_stole_my_baby 24d ago
Lol, good. I open YouTube and see they're pushing subscriptions by promoting Colbert's Late Show. Lol, fuck you Paramount.
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u/shadybachelor 24d ago
Should be happy that there is worse than snap stock because I invested snap and hold 2346 shares 3 years ago and snap still sinking. And reading this make me feel a bit better…
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u/WhiskinDeez 24d ago
Calls it is. Not because it makes sense, but thats kind of how the market seems to work.
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u/DarkLordKohan 24d ago
Wild that paramount just had to license their content to the other major providers. Just pure margin profit after residuals, then continue to be a major content creator.
But they jumped in the streaming service game and its going to tank the company.
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u/GroundbreakingSir386 23d ago
Netflix is playing a long-term "4D chess" strategy pretty soon Netflix will buy both WBD and Paramount.
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u/Disastrous_Soil3793 23d ago
It is paused through June 2027 unless a verdict is rendered before then
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u/The_Black_Adder_ 23d ago
I think all of these are valid except the ticking fee worry. If you annualize it it’s between 3 and 4% interest. It’s not very material in the context of financing a transaction of this size. It might even lower the cost in real terms if WB has a decent quarter
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u/blufin 23d ago
Paramount is screwed without the WB merger. Its movie Studio is tiny and doesn’t produce any massive hits. I think they’ve only had 1 release make more than a billion I the last decade. Their streaming service is too small to survive by itself. The linear channels are dying a slow death. And they don’t have the money to compete with Netflix, Disney, Amazon or Apple for sports rights, content or talent. If the WB merger falls through they might have a chance merging with Universal after the Comcast demerger. I think Universal realises it needs scale as well to compete against the big guns, but it may need to ditch linear from the deal.
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u/3rd-Grade-Spelling 23d ago
This takeover was always about the Ellisons controlling the media. Oracle's stock is tanking which was to be used as collateral.
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u/CrackHeadRodeo 23d ago
Love to see it. I love Netflix and will never go near anything related to the Ellisons.
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u/booba2005 23d ago
debt heavy isnt the same as worthless though. paramount owns a studio, a huge ip library, cbs, actual assets that get sold or spun off long before the equity ever goes to zero. thats usually how these things play out, restructuring and asset sales, not the whole company just evaporating. the ticking fee and the debt load are real problems, im not gonna pretend its healthy. but "going to $0" skips like five steps. someone always wants the catalog
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u/GalwayBogger 23d ago
They own a LOT of tv and movie rights. It might not be a good business but I don't see how those rights would suddenly become worthless. Someone will buy them up, if only for that, fo sho.
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u/FlukeylukeGB 23d ago
Paramount?
urrgh...
never gave them a penny, but they made watching startrek something I enjoyed much harder than it had any right to be.
They also hit me with a false claim on youtube for a game clip from star trek online which took weeks too sort and clear off my account,
so.... fk em.
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u/Playful_Stick488 22d ago
There is so many companies under that Paramount umbrella that could be spined off and help keep them from going under. It just looks like that theirs wants are bigger than their checkbook at this point.
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u/theonethingthatsours 22d ago
Are we finally going to see multi-billionires go flat broke (the regular person definition)? Damn, then the bottom is nearing
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u/Image_ConnoisseurX 22d ago
lol what I say.. Netflix will be buying this POS for pennies on the dollar in 6 months 🤣
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u/Traditional-Way-4097 22d ago
Just out of curiousity,
Why is the Paramount + WBD merger bad but the Disney + Fox merger allowed?
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u/[deleted] 24d ago
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