ViacomCBS Inc. (VIAC) was downgraded Monday to a rare bearish rating at BMO Capital, with analyst Daniel Salmon saying, "This stream has run too far." Salmon cut his rating to underperform, after being at market perform since August 2019. He bumped up his price target to $70 from $60, but that new target is 28.2% below current levels. The stock rallied 2.7% toward a record in afternoon trading, putting it on track for a fourth straight gain and 11th gain in 12 sessions. It rose 27.9% last week for the 12th straight weekly gain, and the best weekly performance since April 2020. Salmon said he believes the new Paramount+ streaming service will drive the subscriber narrative in the short terms, and he thinks it might be "challenging" for a new streaming product, "as the pandemic wains and competitors like Peacock offer differentiated content like the Summer and Winter Olympics" in the next 12 months. In addition, he said Paramount's box-office market share has lagged the likes of Walt Disney Co. (DIS), Universal, WarnerBros in recent years, and could underperform again as theaters reopen more widely as COVID-19-related restrictions ease. ViacomCBS is now just one of 2.3% of the U.S. companies covered by BMO analysts that are rated underperform, while Salmon rates both rivals Disney and Netflix Inc. (NFLX) at outperform. ViacomCBS's stock has rocketed 177.5% over the past three months, while Disney shares have advanced 12.6%, Netflix's stock has lost 1.9% and the S&P 500 has gained 6.8%.
-Tomi Kilgore; 415-439-6400; AskNewswires@dowjones.com
(END) Dow Jones Newswires
March 15, 2021 13:35 ET (17:35 GMT)
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