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Telsey downgrades Viacom on credit rating concerns

An image from the movie "Star Trek Beyond"
Source: Paramount Pictures | YouTube

Telsey Advisory Group lowered its rating for Viacom to market perform from outperform, citing the prospects of a credit rating downgrade or dividend cut.

"Earlier this month, Moody's lowered Viacom's rating outlook from stable to negative. A downgrade of the company's credit next is a real possibility," analyst Tom Eagan wrote in a note to clients Friday.

"Operationally, Viacom's fundamentals continue to trail every other major U.S. entertainment company. A turn-around in FY17 is unlikely."