Even Paramount’s Credit Rating Is Now ‘Junk’

The credit-ratings agency S&P Global just threatened to turn Paramount Mountain into Paramount Hillock.

Standard & Poor’s cut Paramount Global’s credit rating for senior unsecured debt to a “Bb+,” down from a “Bbb-.” Talk about “poor.” Paramount’s credit rating, which will carry through 2025, is now in what the agency considers “junk” status. (S&P Global considers any rating lower than “Bbb” to be junk grade and a “high risk.”)

Even with the downgrade to its borrowing power, Paramount Global’s stock (Para) grew on Wednesday.

In its Wednesday report (obtained by IndieWire), S&P Global cited “the ongoing deterioration of the linear television ecosystem and the elevated investments for its direct-to-consumer (Dtc) streaming model” as its reason for the downgrade. Specifically, Paramount’s Fofc/debt (free operating cash flow vs. debt) rate is “well below” 10 percent. S&P Global expects Paramount to stay there — for a while,...