Chattanooga Times Free Press

ViacomCBS’ stock slump

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ViacomCBS should be riding high. Its rebranded and reworked Paramount+ streaming service launched to decent reviews, and it reported a stronger than expected fourth quarter profit. So why is its stock off 56% since its recent high of $100.34?

Blame a hefty proposed stock offering, spooked analysts and jittery investors.

ViacomCBS shares rose steadily throughout 2020, then spiked in early 2021. Management saw an opportunit­y and on March 22 announced a stock offering of up to $3 billion in order to invest more in streaming.

Shares started falling almost immediatel­y, and before long, some analysts were reconsider­ing their previous bullishnes­s. Michael Nathanson of MoffetNath­anson downgraded ViacomCBS to “sell” on March 25 — after the shares had already fallen 30% — arguing that the company might alienate its traditiona­l cable partners if it shifts too many movies and TV shows to Paramount+.

Also potentiall­y stoking the fire: Major banks had reportedly bought a stake in ViacomCBS on behalf of a little known hedge fund, Archegos Capital Management, then sold off their stakes after the offering announceme­nt.

ViacomCBS shares fell 52% between March 22 and March 26. They’re now trading at $44.

 ?? Sources: FactSet: company filings
Mae Anderson; J. Paschke • AP ??
Sources: FactSet: company filings Mae Anderson; J. Paschke • AP
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