CBS/Viacom Could Face Hurdles, Wells Fargo's Ryvicker Says

A CBS/Viacom combination isn't a fait accompli because the two "do not go together naturally," said Wells Fargo analyst Marci Ryvicker in a note to investors Thursday as it upgraded its rating of Viacom to "market perform." Ryvicker said a CBS/Viacom doesn't appear imminent and could end up not happening since CBS CEO Les Moonves and National Amusements, the majority shareholder of both companies, "have some corporate governance issues to get through" that would give him free rein to make executive decisions. Exacerbating the issue are the different strategies of CBS and Viacom: "You can't just slap [Viacom] and CBS content together -- that would be like eating pickles and ice cream while not being pregnant." But Viacom is trading at close to its potential floor price of roughly $33 per share, and that should provide some stability to the stock for now, Ryvicker said. Any CBS/Viacom likely wouldn't face big regulatory hurdles, experts have said (see 1610050039).