ViacomCBS Stock Analysis
📉 ViacomCBS $VIAC is a stock that I became interested in last year but I missed the opportunity to buy and it gained over 700% in just a year. However, a margin call on the hedge fund (technically only a family office) Archegos Capital caused a massive crash of more than 50%. 𝙄𝙨 𝙩𝙝𝙞𝙨 𝙖 𝙗𝙪𝙮𝙞𝙣𝙜 𝙤𝙥𝙥𝙤𝙧𝙩𝙪𝙣𝙞𝙩𝙮?
⚠️ What happened to ViacomCBS? The company said that they were going to issue shares to raise capital which caused a selloff. But this selloff triggered a 𝙢𝙖𝙧𝙜𝙞𝙣 𝙘𝙖𝙡𝙡 on the Family Office run by Bill Hwang, Archegos Capital and leading to the banks, providing them with this leverage, for example, Credit Suisse $$CSGN.ZU to lose billions. Several other stocks such as Baidu $$BIDU and Discovery $DISCA were also hit.
📺 ViacomCBS is a 𝙢𝙚𝙙𝙞𝙖 𝙘𝙤𝙣𝙜𝙡𝙤𝙢𝙚𝙧𝙖𝙩𝙚, operating under 3 business TV Entertainment, Cable Networks, and Filmed Entertainment with respectively 42%, 50% and 10% of total revenues in 2020. As from this year, there will be a new segment, Streaming. ViacomCBS owns Paramount Pictures, CBS, Showtime and many other networks.
💻 ViacomCBS wants to switch from Cable to 𝙨𝙩𝙧𝙚𝙖𝙢𝙞𝙣𝙜 but there's a lot of competition there from Netflix $NFLX , Disney $DIS , Discovery, Amazon $AMZN and even Apple. Streaming is also a cash drain and Viacom unlike Disney or Amazon is not in a position to lose money.
💰 At current price, I won't call ViacomCBS a value stock but this margin call has given us another better opportunity, Discovery. But that's a video for another day.
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