Wells Fargo Slashes Viacom Outlook

If you think Viacom’s months-long boardroom battle is ugly, wait until the media conglomerate reports its quarterly results next month, according to The NY Post.

You might need to shield the kids and draw the blinds, one Wall Street analyst said on Monday.

Affiliate-fee renewal conversions have been so challenging for Sumner Redstone’s entertainment giant — including a price cut at AT&T’s DirecTV — that overall affiliate-fee revenue will swing from an expected 2 percent increase to a 10 percent decline, the analyst, Wells Fargo’s Marci Ryvicker, said in an investment note to her clients.

Marci Ryvicker

In addition, Viacom’s new carriage deal with Dish Network “didn’t help at all,” Ryvicker said.

Plus, Comcast also put Viacom’s Spike on a lower, less lucrative tier, she noted, which is likely to lead to lower fees for the home of the popular “Lip Sync Battle.”

In film, Ryvicker says Paramount Pictures swung to a $30 million operating loss — from a $39 million operating profit — due to underperforming movies.

In the quarter, ended June 30, Paramount released “Teenage Mutant Ninja Turtles: Out of the Shadows,” which has grossed $219.9 million worldwide through nearly six weeks — compared to $493.3 million for the 2014 original.

As a result, Wells Fargo downgraded the stock to underperform from market perform — but maintained a $38 to $40 price target.

Viacom shares closed trading on Monday at $44.36, down 1.9 percent.

“We think it would be very challenging for anyone to come in and successfully turn this company around over the next 12 months, especially in the cable networks segment,” Ryvicker wrote.