Assessing Paramount Skydance (PSKY)’s Valuation After a 49.5% Year-to-Date Share Price Rebound

Paramount Skydance (PSKY) has quietly turned into a comeback story, with the stock up nearly 50% this year as investors reassess its streaming strategy, studio assets, and earnings trajectory.

See our latest analysis for Paramount Skydance.

That 49.5% year to date share price return, with the stock now at $15.82, suggests investors are steadily re-rating Paramount Skydance as its turnaround narrative around streaming discipline and studio efficiency gains traction, despite weaker multi year total shareholder returns.

If this rebound has you wondering what else might be reshaping the media landscape, it could be worth scouting high growth tech and AI stocks for other potential growth stories riding similar structural shifts.

With shares now above some analyst targets but still trading at a discount to certain intrinsic value estimates, the key question is: does Paramount Skydance remain mispriced, or is the market already baking in its streaming-led rebound?

Price-to-Sales of 0.6x: Is it justified?

On a price to sales basis, Paramount Skydance at $15.82 screens as undervalued, with the market assigning it a 0.6x multiple despite its recent share price rebound.

The price to sales ratio compares the company’s market value to its annual revenue, a useful lens for media businesses that are currently loss making but still generating substantial top line scale.

For Paramount Skydance, that 0.6x multiple looks conservative given it is trading at what appears to be good value versus peers and the broader US media industry. It also sits well below the estimated fair price to sales ratio of 1.5x that our analysis suggests the market could potentially gravitate toward depending on how its profitability narrative develops.

Relative to the US media sector, where sales based valuations are materially higher, the gap points to investors still heavily discounting Paramount Skydance’s earnings recovery and streaming economics, even as the share price rallies. This leaves room for the multiple to expand if execution continues to improve.

Explore the SWS fair ratio for Paramount Skydance

Result: Price to sales of 0.6x (UNDERVALUED)

However, investors still face key risks, including ongoing net losses and execution uncertainty in reshaping legacy TV assets into sustainably profitable streaming platforms.

Find out about the key risks to this Paramount Skydance narrative.

Another View: What Our DCF Says

Our DCF model paints a similar picture, suggesting fair value around $19.64 versus the current $15.82, implying Paramount Skydance is still undervalued by about 19.5%. If both cash flow and sales based lenses agree, the question is whether the market is still underestimating this turnaround story.

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Paramount Skydance for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 933 undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Paramount Skydance Narrative

If you see the story differently or want to stress test the assumptions yourself, you can build a personalized view in just a few minutes: Do it your way.

A great starting point for your Paramount Skydance research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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