Is Paramount Warren Buffett’s Greatest Investment Mistake?
Paramount has been on a downward spiral since the start of 2021. Even Warren Buffett’s endorsement and investment does not aid in slowing the decline. Berkshire Hathaway, as of this write-up, has a 15.4% stake in Paramount which makes it the biggest shareholder.
Based on Barron’s estimate, Berkshire got their Paramount stake (93 million shares) at an average price of close to $30. Based on the current price of $12.5, Buffett is down by close to 60%.
The boiling question will be:
Is Paramount going to be Warren Buffett’s Greatest ?
We have no doubt the streaming business is an extremely competitive industry. Only Netflix is able to churn out profits at this juncture.
Also, to keep consumers engaged, new content has to be regularly created in order to prevent subscribers from leaving their streaming network.
So all these will require massive investments, not unlike the airline business. Amazon has budgeted 15 billion dollars on content creation for 2023.
Click Here for the Full Article:
Based on Barron’s estimate, Berkshire got their Paramount stake (93 million shares) at an average price of close to $30. Based on the current price of $12.5, Buffett is down by close to 60%.
The boiling question will be:
Is Paramount going to be Warren Buffett’s Greatest ?
We have no doubt the streaming business is an extremely competitive industry. Only Netflix is able to churn out profits at this juncture.
Also, to keep consumers engaged, new content has to be regularly created in order to prevent subscribers from leaving their streaming network.
So all these will require massive investments, not unlike the airline business. Amazon has budgeted 15 billion dollars on content creation for 2023.
Click Here for the Full Article:
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