Paramount Skydance (NASDAQ:PSKY) Stock Sees Heavy Put Option Buying

Key Points

• Put-option activity surged: Investors purchased 45,202 PSKY put options, about 52% above average, suggesting increased bearish sentiment or hedging demand.
• Analyst sentiment remains cautious: Paramount Skydance has an average “Reduce” rating and an average price target of $11.17, with nine Sell, five Hold, and four Buy ratings.
• Warner Bros. Discovery deal raises financing concerns: The company launched roughly $44.4 billion in senior secured notes, while investors worry the transaction could leave it with nearly $80 billion in debt; shares fell 2.8% to $9.99.

Paramount Skydance Corporation (NASDAQ:PSKY - Get Free Report) was the recipient of unusually large options trading activity on Tuesday. Investors acquired 45,202 put options on the stock. This is an increase of 52% compared to the average volume of 29,819 put options.

Institutional Trading of Paramount Skydance

Several institutional investors and hedge funds have recently added to or reduced their stakes in the stock. Bank of New York Mellon Corp purchased a new stake in shares of Paramount Skydance during the second quarter worth approximately $14,002,000. Palestra Capital Management LLC purchased a new stake in shares of Paramount Skydance during the 2nd quarter worth $12,798,000. Gradient Investments LLC acquired a new position in shares of Paramount Skydance during the 2nd quarter worth $2,062,000. Wellington Management Group LLP purchased a new position in shares of Paramount Skydance in the 2nd quarter valued at about $3,231,000. Finally, Financiere des Professionnels Fonds d investissement inc. acquired a new stake in shares of Paramount Skydance in the first quarter valued at about $1,623,000. 73.00% of the stock is owned by hedge funds and other institutional investors.

Wall Street Analyst Weigh In

Several equities analysts have commented on PSKY shares. Arete Research restated a "sell" rating and issued a $2.00 price target on shares of Paramount Skydance in a research note on Thursday, July 9th. TD Cowen decreased their target price on Paramount Skydance from $13.00 to $8.00 and set a "hold" rating for the company in a report on Wednesday, August 5th. Citigroup initiated coverage on Paramount Skydance in a report on Monday, September 14th. They set an "outperform" rating on the stock. Weiss Ratings raised Paramount Skydance from a "sell (d-)" rating to a "sell (d)" rating in a research report on Thursday, August 6th. Finally, Morgan Stanley boosted their price objective on Paramount Skydance from $10.00 to $11.50 and gave the stock an "overweight" rating in a research report on Tuesday, September 22nd. Four equities research analysts have rated the stock with a Buy rating, five have given a Hold rating and nine have given a Sell rating to the stock. Based on data from MarketBeat, Paramount Skydance currently has an average rating of "Reduce" and an average price target of $11.17.

Trending Headlines about Paramount Skydance

Here are the key news stories impacting Paramount Skydance this week:

• Positive Sentiment: Paramount Skydance formally launched approximately $44.4 billion of senior secured notes, a key step toward securing permanent financing for the Warner Bros. Discovery transaction. The company also has outlined up to $46.7 billion of equity financing. Paramount Skydance Corporation Announces Launch of Notes Offerings
• Positive Sentiment: Paramount extended its Warner-related exchange and tender offers to October 6, with settlement expected in the fourth quarter. The move suggests the company is continuing to align its liability-management process with the anticipated closing. Paramount Skydance Exchange and Tender Offer Extension
• Neutral Sentiment: The company’s shares are scheduled to undergo a two-for-one split on October 5. The split changes the share count and per-share price but does not directly alter the company’s underlying value.
• Negative Sentiment: Investors are concerned that the Warner transaction could leave Paramount Skydance with nearly $80 billion of debt on a recently downgraded balance sheet. The resulting leverage and financing costs could limit cash flow and increase the consequences of any integration or deal-related problems. Paramount Launches Debt Sale for Warner Bros. Deal
• Negative Sentiment: Unusually heavy put-option activity—45,202 puts purchased, about 52% above typical volume—signals increased bearish or hedging interest in PSKY, although options activity alone does not establish a fundamental outlook.

Paramount Skydance Stock Down 2.8%

NASDAQ:PSKY traded down $0.29 during midday trading on Tuesday, hitting $9.99. 18,882,426 shares of the company were exchanged, compared to its average volume of 12,111,746. Paramount Skydance has a fifty-two week low of $7.62 and a fifty-two week high of $20.09. The company has a market capitalization of $11.21 billion, a PE ratio of 34.45, a price-to-earnings-growth ratio of 0.95 and a beta of 1.50. The company has a current ratio of 1.04, a quick ratio of 0.88 and a debt-to-equity ratio of 1.13. The company has a fifty day simple moving average of $9.85 and a 200 day simple moving average of $10.04.

Paramount Skydance's stock is going to split on the morning of Monday, October 5th. The 2-1 split was recently announced. The newly minted shares will be issued to shareholders after the closing bell on Sunday, October 4th.

Paramount Skydance (NASDAQ:PSKY - Get Free Report) last posted its earnings results on Tuesday, August 4th. The company reported $0.18 EPS for the quarter, topping analysts' consensus estimates of $0.15 by $0.03. The business had revenue of $6.91 billion for the quarter. Paramount Skydance had a positive return on equity of 4.11% and a negative net margin of 2.13%. As a group, equities analysts anticipate that Paramount Skydance will post 0.56 earnings per share for the current fiscal year.

Paramount Skydance Dividend Announcement

The firm also recently declared a quarterly dividend, which will be paid on Thursday, October 1st. Investors of record on Tuesday, September 15th will be paid a dividend of $0.05 per share. The ex-dividend date is Tuesday, September 15th. This represents a $0.20 dividend on an annualized basis and a yield of 2.0%. Paramount Skydance's dividend payout ratio is currently 68.97%.

About Paramount Skydance

Paramount Skydance Corporation NASDAQ: PSKY is a global media and entertainment company formed through the combination of Paramount Global and Skydance Media. The company develops, produces and distributes feature films, television programming and other video content for audiences in the United States and international markets.

Its portfolio includes Paramount Pictures, CBS, Nickelodeon, MTV, Comedy Central, BET, Showtime and other well-known entertainment brands. Paramount Skydance also operates streaming services including Paramount+ and Pluto TV, as well as businesses involved in television broadcasting, news, sports and content licensing.

The company's history includes Paramount Pictures, one of Hollywood's longstanding film studios, and Skydance Media, a production company founded in 2010 by David Ellison.

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