TLDR
- Paramount Skydance stock rose nearly 3% after its animated content deal with Netflix ended following the Skydance Animation merger
- Both companies confirmed upcoming animated films “Ray Gunn” and an untitled Jack and the Beanstalk project will still release on Netflix
- A new report estimates Paramount leaving California could cost the state between $1.01 billion and $2.03 billion in economic output over five years
- Citizens initiated PSKY with a Market Outperform rating and a $14 price target, citing the pending WBD deal and over $6 billion in cost synergies
- Wall Street has a Hold consensus on PSKY with an average price target of $10.50, implying 3.71% downside from current levels
Paramount Skydance (PSKY) stock climbed nearly 3% in the final minutes of Friday’s trading session after news broke that its animated content agreement with Netflix had come to an end. The stock was trading around $10.60 at the time. PSKY has still lost nearly 43% over the past year.
Paramount Skydance Corporation Class B Common Stock, PSKY
The deal that ended was not a new one. It originated between Netflix and Skydance Animation back when that studio existed as a standalone entity. When Paramount and Skydance merged to form Paramount Skydance, Skydance Animation was folded into the broader company, effectively ending the legal entity that held the agreement.
The contract simply ran out, and with no Skydance Animation left to renew it, the deal dissolved.
That does not mean the two companies are going their separate ways entirely. Paramount and Netflix issued a joint statement confirming they remain committed to releasing “Ray Gunn” and an untitled Jack and the Beanstalk film on the platform.
The statement also confirmed the two companies will continue their broader content licensing relationship. So while the specific animation pact is gone, business between the two continues.
WBD Deal Draws Fresh Analyst Attention
Citizens initiated coverage on PSKY this weekend with a Market Outperform rating and a $14 price target. That implies around 32% upside from the current price of $10.60.
The firm cited Paramount’s pending combination with Warner Bros. Discovery as the core reason for its optimism. Citizens analyst Matthew Condon said the deal would create a scaled global content platform and that management has a credible path to roughly 3x net leverage within three years of closing.
Citizens also pointed to more than $6 billion in cost synergies expected from the merger. The $14 price target was built on a probability-weighted valuation tied to the WBD deal closing.
The WBD merger has not been without friction. California Attorney General Rob Bonta canceled settlement talks, accusing Paramount of leaking meeting details. The deal did, however, receive approval from the U.K. government.
California Counts the Cost
A separate report from the Los Angeles Economic Development Corporation put numbers on what it would mean for California if Paramount left the state.
The findings were stark. The report estimated losses of between 2,750 and 5,550 job-years across all California industries between October 2026 and September 2031.
Economic output losses were projected at between $1.01 billion and $2.03 billion over the same period.
On the earnings side, Paramount reported Q2 2026 results that beat expectations on Paramount+ subscriber growth, partly driven by the World Cup. The company also topped adjusted EBITDA forecasts and raised its guidance.
Despite the positive Q2 results, Raymond James kept its Market Perform rating on the stock. The broader Wall Street consensus sits at Hold, based on two Buys, five Holds, and three Sells over the past three months, with an average price target of $10.50.
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