ViacomCBS Stock Upgraded Amid Streaming Buzz

The company is launching a streaming service in Europe with Comcast

Deputy Editor
Aug 18, 2021 at 9:39 AM
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ViacomCBS Inc (NASDAQ:VIAC) stock is up 3.2% to trade at $40.28 at last check, after the media company received an upgrade from Wells Fargo to "overweight" from "equal weight," with a price-target hike to $60 from $45. The firm praised the company's streaming growth, given its deal with Comcast (CMCSA) to launch a streaming service, "SkyShowtime," in Europe for 2022. Plus, the brokerage firm believes that the broadcasting giant's content capabilities make it a standout amongst media peers. 

Ever since the stock's late-March plummet from its March 15 record high of $101.97, ViacomCBS stock has struggled to stage any semblance of a rally on the charts. Though several short-term moving averages are providing overhead pressure, the 320-day moving average has swooped in to catch recent pullbacks. Year-over-year, the equity is still up 43.3%, although VIAC is still battling its year-to-date breakeven level. 

The upgrade today is notable because of the 18 analysts in coverage, six carry a "buy" or better rating on VIAC, with nine a "hold," and three a "strong sell." Meanwhile, the 12-month consensus price target of $51.96 is a 33.1% premium to current levels. 

Calls have been particularly popular in the options pits though, per the security's 50-day call/put volume ratio of 6.04 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). This ratio stands higher than 86% of readings from the past year, indicating long calls being picked up at a faster-than-usual rate. 

Now seems to be an attractive time for near-term traders to trade VIAC with options. This is based on the security's Schaeffer's Volatility Index (SVI) of 40%, which sits in the 4th annual percentile, indicating muted volatility expectations are being priced into short-term contracts. What's more, the security's Schaeffer's Volatility Scorecard (SVS) stands at 95 out of a possible 100. This shows the media stock has tended to make larger-than-expected moves on the chart over the past year, relative to what the options market has priced in.

 

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