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Live Nation (LYV) Stock Dips 41% YTD: Can It Revive in 2023?

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Shares of Live Nation Entertainment, Inc. (LYV - Free Report) struggled to perform well in 2022. Year to date, the stock has declined 41.3% compared with the industry’s fall of 37%. However, the company’s shares in 2023 might take a U-turn, as demand for concerts is likely to be robust in 2023.

This Zacks Rank #3 (Hold) company has a VGM score of B. The company’s sales and earnings in 2023 are likely to witness year-over-year improvements of 3.9% and 121.7%, respectively.

Let’s delve deeper.

Growth Drivers

Robust demand is likely to drive the company’s performance in 2023. For concerts, the company said that it already sold more than 115 million tickets this year, up 37% from the same period in 2019. The company is highly optimistic about its growth opportunities in 2023.

For shows in 2023, Live Nation is witnessing even stronger ticket sales. In 2023, it expects to add more venues to its operated portfolio. In terms of tickets, the company is likely to benefit from the market pricing trend.

Live Nation believes that several of its artists like Dave Matthews, Luke Bryan, Maroon 5, Travis Scott and Garth Brooks will have multi-year tours across the United States and Europe. This, in turn, will drive the company’s performance.

The COVID-19 pandemic acted as a boon for Ticketmaster. The demand for digital ticketing has increased as venues and artists are seeking contactless transactions due to the pandemic. Ticketmaster will benefit in 2022 from increased Live Nation concert ticket sales and additional sales from new clients. The company is benefiting from investments in technology.

 

Zacks Investment Research
Image Source: Zacks Investment Research

 

The company’s sponsorship continues to witness robust growth. In third-quarter 2022, sponsorship revenues were $343 million, up 96.7% from the prior-year quarter. Moreover, adjusted operating income rose to $226.2 million from $111.2 million in the prior-year quarter.

The company is likely to benefit from the buyout of OCESA, a Mexican entertainment company in which broadcaster Televisa has a 40% stake. OCESA has a strong presence in Latin America.

Prior to the pandemic, the company promoted more than 3,100 events for nearly 6 million fans across Mexico and Colombia. It has a strong business portfolio in ticketing, sponsorship, food and beverage, merchandise, and venue operation. The company has 13 premier venues across Mexico.

Key Picks

Some better-ranked stocks in the Zacks Consumer Discretionary sector are Monarch Casino & Resort, Inc. (MCRI - Free Report) , Hilton Grand Vacations Inc. (HGV - Free Report) and Hyatt Hotels Corporation (H - Free Report) .

Monarch Casino sports a Zacks Rank #1 (Strong Buy) at present. MCRI has a trailing four-quarter earnings surprise of 9.1%, on average. The stock has gained 20.5% in the past year. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for MCRI’s 2022 sales and earnings per share (EPS) indicates growth of 21.1% and 29.2%, respectively, from the year-ago period’s reported levels.

Hilton Grand Vacations currently flaunts a Zacks Rank #1. HGV has a trailing four-quarter earnings surprise of 3.7%, on average. The stock has declined 6.2% in the past year.

The Zacks Consensus Estimate for HGV’s 2022 sales and EPS indicates increases of 63.8% and 60.9%, respectively, from the year-ago period’s levels.

Hyatt currently has a Zacks Rank #2 (Buy). H has a trailing four-quarter earnings surprise of 652.3%, on average. The stock has gained 20.9% in the past year.

The Zacks Consensus Estimate for H’s current financial year’s sales and EPS indicates surges of 91.9% and 121%, respectively, from the year-ago period’s reported levels.

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