Jim Cramer has never been shy about dropping some shocking calls.
His latest one, though, collides with the debut of David Ellison’s $8.4 billion entertainment giant.
That’s no small feat, with the company being born from one of Hollywood’s biggest mergers this decade.
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Layer that with a record UFC rights deal and Ellison’s potent tech-meets-media strategy, and the setup has all the ingredients to go even higher after its monster rally post-merger.
The real question is whether that Silicon Valley-flavored studio energy fuels rapid expansion in an otherwise sluggish media space, or distracts from execution.
David Ellison takes the helm in $8.4 billion Paramount-Skydance merger
Paramount and Skydance finally closed their hotly anticipated $8.4 billion merger, resulting in “Paramount, a Skydance Corporation” under the PSKY ticker.
The deal essentially positions David Ellison, son of Larry Ellison of Oracle (ORCL) fame, in the driver’s seat as chairman and CEO, with Jeff Shell as president.
The two look to set a course to efficiently stabilize linear TV, sharpen streaming economics, and energize the studio slate.
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The combined company will operate across three core segments, including Studios, Direct-to-Consumer, and TV Media. They’ll be keeping marquee cable brands, including Nickelodeon, MTV, and BET, to support streaming and ad sales.
The management’s already dished out their first creative swing in supercharging annual film output from roughly eight titles to 15 by 2026, pushing to 20.
Though that $8.5 billion tag is massive, it still sits comfortably below the industry’s largest tie-ups. It’s closer to the Amazon-MGM ($8.5 billion) tier, but far smaller than the likes of AOL-Time Warner ($165 billion) or Disney-21st Century Fox ($71 billion).
That said, Ellison brings his Silicon Valley sensibilities in hopes of reinvigorating the media space.
That mindset is likely to include data-driven workflows and AI-assisted storytelling, while building towards a fortress of a balance sheet.
In his first staff letter, he told management that he aims to pair high-quality storytelling with cutting-edge technology in ushering in the next era of entertainment. That will entail leaning on proven franchises (“Star Trek,” “Transformers”) while building new IP.
UFC mega-deal gives Paramount+ a sports power play
Within a few days post-merger, Ellison’s new-look Paramount landed an exclusive U.S. rights deal with the UFC. The deal, worth a whopping $7.7 billion over seven years, equates to $1.1 billion annually.
Starting in 2026, Paramount+ will stream the entire U.S. slate of 13 numbered UFC events, including 30 Fight Nights and specific simulcasts on CBS.
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For perspective, the UFC is the premier mixed martial arts sports league, pulling in millions of viewers for each event, and has evolved into a household combat sports brand.
The deal also breaks the age-old pay-per-view model, supercharging Paramount’s streaming efforts.
Given the streaming fatigue debate, live sports arguably remain the last big format that can consistently draw massive real-time audiences.
Netflix (NFLX) , Amazon Prime, and other platforms are going all-in on sports, and Paramount’s UFC deal now gives it some serious bragging rights.
Paired with a superb pipeline of globally marketable films, the UFC deal gives Paramount+ a potential edge with the younger, sports-driven demographic.
Jim Cramer slaps meme-stock tag as Paramount Skydance stock soars
Jim Cramer just slapped a “meme stock” label on red-hot Paramount Skydance stock, that’s been on quite the run post-merger.
On Aug. 13, Cramer posted on X: “Paramount (PSKY) is a meme stock!!!!!!!!!!!!!! Small float… shocking.”
The timing of the post was uncanny, with the stock surging 36.7% to a new 52-week high of $17.53. That incredible rally was the company’s best two-day run since 1990.
Also, volume spiked to roughly 131 million shares, over triple the three-day average of 41 million post-deal, typical of a meme-stock rally where a small float meets outsized attention.
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Why the meme setup?
Skydance owns close to 70% of the company, leaving a remarkably thin tradable supply.
That low float, combined with a ton of interest from retail traders and the Reddit crowd, indicates a possible short positioning, creating perfect conditions for exaggerated price swings.
Nevertheless, the frenzy wasn’t entirely without fundamentals as discussed earlier.
Still, Cramer’s remark is more of a market-structure caution. The current setup with Paramount stock is what we usually see with meme stock, where liquidity gaps and social-media buzz tend to outshine fundamentals in the short term.
These can effectively lead to sharp squeeze-style rallies along with equally swift reversals.
For those with a long-term horizon, though, the challenge is to effectively filter out the meme noise and zero in on Ellison’s strategic catalysts and his execution over the next few quarters.
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