Insiders Are Buying Paramount (PARA) Stock. Here’s Why.

  • National Amusements purchased 646,764 shares of Paramount Global (NASDAQ:PARA) stock
  • The transaction amounted to more than $20 million
  • National Amusements is classified as an insider since it owns more than 10% of all shares
PARA stock: the Paramount plus logo on a phone in front of a screen displaying various Paramount TV shows and movies
Source: viewimage / Shutterstock

Shares of Paramount Global (NASDAQ:PARA) are in focus following a massive $20 million insider purchase. For context, ViacomCBS rebranded as Paramount this year and highlighted its focus on streaming services and company content.

Recently, Warren Buffett’s Berkshire Hathaway (NYSE:BRK-A, NYSE:BRK-B) revealed through a quarterly 13F filing that it had acquired 69 million Class B, or non-voting, shares worth around $2.2 billion. In addition, the stake reflects 10.6% ownership. However, Buffett was not required to file a Form 4 to disclose his position prior to the 13F disclosure. This is likely due to Berkshire owning non-voting shares instead of voting shares.

Now, an insider of the company is following suit. Let’s get into the details.

National Amusements Buys PARA Stock

National Amusements is a theater and media holding company based in Massachusetts. On May 17, the company purchased 646,764 shares of PARA at an average price of $32.36. In total, the transaction amounted to a whopping $20.9 million. After the purchase, National Amusements owns a total of 32.01 million shares.

Excluding National Amusements, the most recent insider purchase occurred on Feb. 18. On that day, Director Shari Redstone purchased 104,650 shares at average prices ranging between $28.17 and $29.08. In total, the transaction amounted to just under $3 million. After the purchase, the director directly owns a total of 313,997 shares.

The two insiders likely believe that the company’s shift to streaming will benefit it in the long run. During Paramount’s Investor Day, the company guided for 100 million Paramount+ and Showtime subscribers by the end of 2024. In the same year, Paramount expects to exceed $9 billion of annual revenue. In Q1, the company had a total of 62 million subscribers.

Who Else Is Betting Big on Paramount?

Tracking institutional ownership is important, as these large funds provide liquidity and price support for stocks. During Q1, 874 funds reported owning PARA, a decrease of 44 funds from the prior quarter. Meanwhile, the company carries an institutional put/call ratio of 1.42. This signifies that funds in aggregate own more put options against the company than call options. A few prominent investors that increased their position during the quarter include BlackRock (NYSE:BLK), Vanguard Group, and Geode Capital Management.

On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.


Article printed from InvestorPlace Media, https://investorplace.com/2022/05/insiders-are-buying-paramount-para-stock-heres-why/.

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