On Aug. 7, Hollywood’s old guard and Silicon Valley’s disruptors officially merged, as Paramount Global and Skydance Media sealed an $8.4 billion pact to create Paramount, a Skydance Corporation (PSKY). Under the leadership of CEO David Ellison, the newly combined entity seeks to integrate Paramount’s cinematic heritage with Skydance’s technological expertise.
Yet, almost overnight, PSKY became something else entirely: a meme stock. In Street talk, that’s a stock rocketed higher by social media hype and speculative fervor, not cold financial calculus. CNBC’s Jim Cramer fanned the flames Wednesday, posting: “Paramount, (PSKY), is a meme stock!!!!!!!!!!!!!! Small float… shocking.” A low float means a scarcity of shares, which can send prices into a manic whiplash when demand spikes.
The numbers are stellar with short interest at 11.8%, Reddit’s (RDDT) r/wallstreetbets whispering, volume blowing past 133 million shares, and a 45% surge in two sessions. Adding in a $7.7 billion UFC rights win, and the momentum is impressive.
Now, with the rally marking PSKY stock’s biggest two-day gain since predecessor company Viacom’s 1990 debut, should investors jump in here or watch from the shore on this one?
About Paramount Skydance Stock
Paramount, a Skydance Corporation, is a next-generation media powerhouse, blending Hollywood legacy with modern innovation. Its three pillars - Studios, Direct-to-Consumer, and TV Media - house iconic brands from Paramount Pictures and CBS to Nickelodeon, MTV, and Showtime, alongside Skydance’s animation, gaming, and sports divisions. With streaming, broadcast, and interactive content under one roof, the company crafts a diversified entertainment empire, commanding a market capitalization of $10 billion.
PSKY stock has surged by nearly 36% over the past five days, fueled in large part by Jim Cramer’s viral tweet. The stock spiked to a high of $17.53 before retracing some gains. Volume surged and the RSI jumped from an oversold 22 on Aug. 11 to a bullish 66 on Aug. 13, signaling strong momentum and heightened volatility in this newly minted meme stock.
Rough Waters Ahead for the Paramount-Skydance Merger?
When Paramount and Skydance merged, the pitch was clear - combining Paramount’s global distribution muscle with Skydance’s production firepower. CEO David Ellison envisions a tech-fueled content renaissance, but the road is lined with potholes.
Skydance’s 70% stake shrinks PSKY’s public float to roughly just $3 billion, sparking liquidity concerns. Integration moves like merging Paramount+ and Pluto TV and newsroom cuts could rattle stability. Content diversity is another flashpoint, the cancellation of shows like The Late Show with Stephen Colbert, shifts in CBS News, and fears of political interference stir debate.
Even with an ombudsman in place, skeptics remain. And then there’s the culture clash: Ellison’s Silicon Valley hustle versus Hollywood tradition. Whether this hybrid thrives will hinge on balancing efficiency with creative soul.
What Do Analysts Expect for PSKY Stock?
Recently, Guggenheim analyst Michael Morris initiated coverage of PSKY with a “Buy” rating and a $13 price target, signaling confidence in the newly merged Paramount-Skydance. The analyst points to the UFC media rights deal, David Ellison’s leadership, and a tech-forward strategy as growth catalysts. The brokerage firm sees the merger’s blend of Hollywood legacy and Silicon Valley innovation unlocking new distribution and production opportunities, though execution risks remain.
Sure, there are hurdles – integrating two giants is not a quick cut - but Guggenheim thinks the upside outweighs the risk. The real details are expected to emerge with Q3 earnings, but for now, it is calling PSKY a growth script worth following.
PSKY stock has an overall “Moderate Sell” rating. Of the 23 analysts covering the stock, just two advise a “Strong Buy,” 12 recommend a “Hold,” and the remaining nine are skeptical, giving a “Strong Sell” rating. The recent meme-stock-fueled rally has pushed PSKY above its average target of $11.44. The Street-high target of $16 implies the stock could rally as much as 6.7%.
Final Thoughts on Paramount Skydance Stock
The company’s merger-fueled narrative is compelling, but the meme stock frenzy clouds the technical picture. With liquidity constraints, integration risks, and a sharply divided analyst base, volatility is a significant concern. Short-term momentum, fueled by social media-driven speculation, could keep volatility elevated, but sustained gains will hinge on executing post-merger synergies.
Right now, PSKY stock is less like a safe, steady place to park your money and more like a fast, unpredictable river – manageable only if you have the skill and stomach for the risk.
