Why Paramount Global Shares Soared Last Month
Shares of Paramount Global (NASDAQ: PARA) surged in May. The vote-wielding Class A stock with the PARAA ticker gained 16.8% last month, while the nonvoting Class B ticker PARA rose 17.9%, according to data from S&P Global Market Intelligence. The gains were sparked by a sizable investment by Warren Buffett's Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B).
Berkshire invested $2.6 billion in Paramount during the first quarter, according to regulatory filings that were posted on May 16. Berkshire is now the entertainment conglomerate's largest shareholder, owning an 11.3% stake in the nonvoting Class B stock. Share prices soared more than 15% the next day.
Buffett's insurance-backed investment conglomerate has not yet shared the thinking behind this investment, but Paramount chief financial officer Naveen Chopra addressed the move two days later. Speaking at the MoffettNathanson Media & Communications Summit, Chopra said that Buffett appears to be pouncing on a deep-discount value investment:
Source Fool.com
