What happened

Shares of movie studio and video streamer Paramount Global (PARA -1.14%) dropped 15.9% in December 2022, according to data from S&P Global Market Intelligence. This was a roller-coaster ride with several distinct twists and turns.

So what

First, Paramount shares dipped 11% in two days after CEO Bob Bakish spoke at an investor conference, hinting that ad sales were running slower than expected in the ongoing fourth quarter. Yet all was forgiven three days later when the Paramount+ streaming service was launched in the German-speaking parts of Europe. The stock gained 8.4% in the two days after that announcement. The streaming platform is now available in 45 global markets on every continent except Africa.

The bears returned the following week. Paramount's stock fell 8.8% on Dec. 15, dragged along in a marketwide crash inspired by the Federal Reserve lifting interest rates by another 0.5%. The higher rate won't affect Paramount's subscription revenue or viewer acquisition efforts much, but advertisers will probably hold on to their marketing budgets a bit tighter when Fed rates run high. Ad sales accounted for 23% of Paramount's total third-quarter sales, so any news that might hurt or help ad sales also has the power to move Paramount's stock price.

Now what

Paramount has struggled recently. There's a lot of competition in the video entertainment market -- online and offline -- and the company's operating earnings are trending down. However, that's not the end of the story. Paramount still plans to invest in content and grow its streaming subscriber base.

Now, this strategy might keep its streaming operations' operating profits in the red for a while. However, the stock's forward-looking price-to-earnings ratio is relatively low at 14.8 and it has a generous dividend yield of 4.9%, which could be appealing to long-term investors. And it never hurts that Warren Buffett's Berkshire Hathaway is taking an active interest in Paramount, building a 16% stake in the company last year.

I'm not completely convinced that this classic movie studio has what it takes to be a leading player in the rapidly evolving media-streaming market, so I prefer to invest in proven winners in that particular category. But the company deserves a close look if you're looking for a media stock with beefy dividends and an extensive portfolio of proven movie franchises. And Berkshire's hands-on involvement could unlock strategies and opportunities that weren't available to Paramount earlier. So I'll keep an eye on this intriguing company, for sure. Maybe you should, too.