Bank of America thinks media giant Paramount could see big gains ahead. Analyst Jessica Reif Ehrlich upgraded the stock to buy from neutral Tuesday. She also hiked her price target on Paramount to $32 per share from $24 per share, implying upside of 54.1%. Ehrlich noted the company’s list of strong assets that could aid the business if it ever puts itself up for sale. “It is our view that PARA has a unique collection of assets that would generate significant buyer interest if ever put up for sale—either in pieces or whole,” Ehrlich said. “Recent press reports (Reuters and others) suggest there is interest from at least four qualified buyers for BET.” Shares of Paramount popped 5.4% in premarket trading Tuesday, adding to the company’s 23% gain from the start of the year. PARA YTD mountain Bank of America sees Paramount as a buy thanks to the company’s strong assets in the event of a sale of the business. Even though concerns remain over Paramount’s ability to successfully transition toward streaming without neglecting the legacy media operation, Ehrlich said that even the downside risk could still turn positive. Either Paramount is successful in pivoting toward streaming which in turn will speed up earnings growth, or the company is forced to sell at a premium, she said. And, despite a noted unwillingness from Paramount Chair Shari Redstone, “market dynamics could increase pressure to consider an offer or to proactively sell.” — CNBC’s Michael Bloom contributed to this report.
Bank of America upgrades this media giant, citing strong assets in a potential sale
