Yahoo Finance Live Nation (LYV) Stock Up 21% in Six Months: More Room to Run?
Live Nation Entertainment, Inc. LYV is poised to benefit from pent-up demand for live events, robust ticket sales and the sponsorship and advertising business. Moreover, continued show count and attendance growth have been necessary for sales improvement over the last few quarters.
In the past six months, shares of Live Nation have gained 20.7% compared with the industry’s 10.5% growth. The price performance was backed by solid earnings surprise history. Live Nation’s earnings surpassed the Zacks Consensus Estimate in three of the trailing four quarters. Earnings estimates for 2023 and 2024 have moved up 274.1% and 49.1% in the past 60 days, respectively. This positive trend signifies bullish analysts’ sentiments and justifies the company’s Zacks Rank #1 (Strong Buy), indicating robust fundamentals and the expectation of outperformance in the near term. You can see the complete list of today’s Zacks #1 Rank stocks here.
Growth Catalysts
Solid Demand: The company benefits from pent-up demand for live events and robust ticket sales. During the second quarter of 2023, the company reported solid contributions from the Concerts segment fueled by stadium and arena fan count growth, higher food and beverage spending and upsells. During the quarter, Concerts segment revenue increased 29% year over year to $4.6 billion. The company reported solid attendance in international markets — in particular, Europe, Asia Pacific and Latin America. Also, it stated benefits from global large act tours, including Coldplay, Beyoncé, and Harry Styles. The company said that it has already sold more than 117 million tickets (as of Jul 2023), up more than 20% from the same period in 2022.
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The company is highly optimistic about its growth opportunities in 2023. For shows in 2023, it is witnessing even stronger ticket sales. Live Nation Entertainment believes that several of its artists like Dave Matthews, Luke Bryan, Maroon 5, Travis Scott and Garth Brooks, among others, will have multi-year tours across the United States and Europe. This, in turn, will likely drive the company’s performance.
Venue Nation: Increased focus on Venue Nation portfolio bodes well. In 2023, the company emphasized hosting nearly 3 million fans at 1,000 shows. The company initiated tactical improvements across its amphitheaters (or theaters) and clubs involving new bar designs and additional points of sale. It is optimistic in this regard and anticipates the initiative to drive long-term growth and profitability across its businesses. Also, focus on acquisitions and new market entries bodes well.
Sponsorship Business: The company emphasizes sponsorship and advertising businesses to drive growth. During the second quarter, the Sponsorship & Advertising segment revenues totaled $302.9 million, up 15% from the year-ago quarter’s figure. The upside was backed by solid United States business (with new deals for owned and operated amphitheaters), the addition of the new Moody Center arena (in Austin) and Ticketmaster’s new global relationship with PayPal (preferred payment partner).
Given the strength in consumer demand (for the upcoming shows) and confirmed sponsorship activity (of more than 90%), the momentum will likely persist in the upcoming periods.
Other Key Picks
Some other top-ranked stocks in the Consumer Discretionary sector include:
Royal Caribbean Cruises Ltd. RCL sports a Zacks Rank #1. RCL has a trailing four-quarter earnings surprise of 28.5% on average. Shares of RCL have gained 102.3% in the past year.
The Zacks Consensus Estimate for RCL’s 2023 sales and EPS indicates a rise of 54.5% and 180.3%, respectively, from the year-ago period’s levels.
Skechers U.S.A., Inc. SKX sports a Zacks Rank #1. The company has a trailing four-quarter earnings surprise of 39.1% on average. Shares of SKX have increased 35.1% in the past year.
The Zacks Consensus Estimate for SKX’s 2023 sales and EPS indicates a rise of 8.7% and 42%, respectively, from the year-ago period’s levels.
OneSpaWorld Holdings Limited OSW currently carries a Zacks Rank #2 (Buy). OSW has a trailing four-quarter earnings surprise of 42.6% on average. Shares of OSW have increased 27.2% in the past year.
The Zacks Consensus Estimate for OSW’s 2023 sales and EPS indicates a rise of 44.5% and 117.9%, respectively, from the year-ago period’s levels.
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Royal Caribbean Cruises Ltd. (RCL) : Free Stock Analysis Report
Skechers U.S.A., Inc. (SKX) : Free Stock Analysis Report
Live Nation Entertainment, Inc. (LYV) : Free Stock Analysis Report
OneSpaWorld Holdings Limited (OSW) : Free Stock Analysis Report
