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Live Nation (LYV) Stock Up 35% in a Year: More Room to Run?
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Live Nation Entertainment, Inc. (LYV - Free Report) is poised to benefit from pent-up demand for live events, solid ticket sales and the sponsorship and advertising business. Additionally, the robust volume experienced via the Ticketmaster platform has been essential for driving sales improvement in the past few quarters.
In the past year, shares of Live Nation have gained 34.9% compared with the industry’s 25.7% 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 2024 have moved up 37.9% in the past 60 days. 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
The company benefits from pent-up demand for live events and robust ticket sales. During the third quarter, the company reported solid contributions from the Concerts segment fueled by growth in stadium and arena fan count, higher food and beverage spending and upsells. During the quarter, the Concerts segment’s revenues increased 32% year over year to $7 billion. During the quarter, the company reported solid attendance in international markets — in particular, Europe, Asia Pacific and Latin America. Also, it stated benefits from two significant tours in Beyoncé and Taylor Swift. Concert adjusted operating income during the third quarter came in at $340.9 million compared with $280.8 million reported in the prior-year quarter.
The company holds optimism regarding its long-term potential and is concentrating on fundamental aspects of its business model. This includes expanding its concert platform to attract more shows and fans in current and new markets. Efforts are also underway to elevate the on-site experience for fans by improving food and beverage options and enhancing premium service offerings.
Image Source: Zacks Investment Research
Increased focus on the Ticketmaster platform bodes well. Ticketmaster expects to benefit in the remaining 2023 from increased Live Nation concert ticket sales and additional sales from new clients. The company is benefiting from the non-service fee revenue sources. In the first nine months of 2023, the company sold 257 million fee-bearing tickets, up 22% from the previous year’s levels. It is on track to manage a total of more than 600 million tickets this year, including over 300 million fee-bearing tickets.
The company emphasizes sponsorship and advertising businesses to drive growth. During the third quarter, the Sponsorship & Advertising segment revenues totaled $366.8 million, up 7% from the year-ago quarter’s figure. The upside was backed by solid United States business (with new strategic deals), the addition of the new Moody Center arena (in Austin) and new marketing partners in Mexico, including a new banking client that sponsored an inaugural festival and other local events. Operating income in the quarter came in at $250.3 million compared with $226.2 million reported in the prior-year period.
Given the strength in consumer demand (for the upcoming shows) and confirmed sponsorship activity (fully committed) at more than $1 billion in revenues, the momentum is likely to persist in the upcoming periods.
TEGNA Inc. (TGNA - Free Report) sports a Zacks Rank #1. TGNA has a trailing four-quarter earnings surprise of 7.6% on average. Shares of TGNA have gained 6.2% in the past three months.
The Zacks Consensus Estimate for TGNA’s 2024 sales and earnings per share (EPS) indicates a rise of 13.6% and 92.2%, respectively, from the year-ago period’s levels.
JAKKS Pacific, Inc. (JAKK - Free Report) sports a Zacks Rank #1. It has a trailing four-quarter earnings surprise of 61.8%, on average. Shares of JAKK have skyrocketed 107.5% in the past year.
The Zacks Consensus Estimate for JAKK’s 2024 sales calls for 3.6% growth from the year-earlier levels.
Royal Caribbean Cruises Ltd. (RCL - Free Report) carries a Zacks Rank #2 (Buy). RCL has a trailing four-quarter earnings surprise of 28.3%, on average. Shares of RCL have surged 162.9% in the past year.
The Zacks Consensus Estimate for RCL’s 2024 sales and EPS indicates a rise of 13.7% and 38.1%, respectively, from the year-ago levels.
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Live Nation (LYV) Stock Up 35% in a Year: More Room to Run?
Live Nation Entertainment, Inc. (LYV - Free Report) is poised to benefit from pent-up demand for live events, solid ticket sales and the sponsorship and advertising business. Additionally, the robust volume experienced via the Ticketmaster platform has been essential for driving sales improvement in the past few quarters.
In the past year, shares of Live Nation have gained 34.9% compared with the industry’s 25.7% 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 2024 have moved up 37.9% in the past 60 days. 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
The company benefits from pent-up demand for live events and robust ticket sales. During the third quarter, the company reported solid contributions from the Concerts segment fueled by growth in stadium and arena fan count, higher food and beverage spending and upsells. During the quarter, the Concerts segment’s revenues increased 32% year over year to $7 billion. During the quarter, the company reported solid attendance in international markets — in particular, Europe, Asia Pacific and Latin America. Also, it stated benefits from two significant tours in Beyoncé and Taylor Swift. Concert adjusted operating income during the third quarter came in at $340.9 million compared with $280.8 million reported in the prior-year quarter.
The company holds optimism regarding its long-term potential and is concentrating on fundamental aspects of its business model. This includes expanding its concert platform to attract more shows and fans in current and new markets. Efforts are also underway to elevate the on-site experience for fans by improving food and beverage options and enhancing premium service offerings.
Image Source: Zacks Investment Research
Increased focus on the Ticketmaster platform bodes well. Ticketmaster expects to benefit in the remaining 2023 from increased Live Nation concert ticket sales and additional sales from new clients. The company is benefiting from the non-service fee revenue sources. In the first nine months of 2023, the company sold 257 million fee-bearing tickets, up 22% from the previous year’s levels. It is on track to manage a total of more than 600 million tickets this year, including over 300 million fee-bearing tickets.
The company emphasizes sponsorship and advertising businesses to drive growth. During the third quarter, the Sponsorship & Advertising segment revenues totaled $366.8 million, up 7% from the year-ago quarter’s figure. The upside was backed by solid United States business (with new strategic deals), the addition of the new Moody Center arena (in Austin) and new marketing partners in Mexico, including a new banking client that sponsored an inaugural festival and other local events. Operating income in the quarter came in at $250.3 million compared with $226.2 million reported in the prior-year period.
Given the strength in consumer demand (for the upcoming shows) and confirmed sponsorship activity (fully committed) at more than $1 billion in revenues, the momentum is likely to persist in the upcoming periods.
Other Key Picks
Some other top-ranked stocks in the Consumer Discretionary sector include:
TEGNA Inc. (TGNA - Free Report) sports a Zacks Rank #1. TGNA has a trailing four-quarter earnings surprise of 7.6% on average. Shares of TGNA have gained 6.2% in the past three months.
The Zacks Consensus Estimate for TGNA’s 2024 sales and earnings per share (EPS) indicates a rise of 13.6% and 92.2%, respectively, from the year-ago period’s levels.
JAKKS Pacific, Inc. (JAKK - Free Report) sports a Zacks Rank #1. It has a trailing four-quarter earnings surprise of 61.8%, on average. Shares of JAKK have skyrocketed 107.5% in the past year.
The Zacks Consensus Estimate for JAKK’s 2024 sales calls for 3.6% growth from the year-earlier levels.
Royal Caribbean Cruises Ltd. (RCL - Free Report) carries a Zacks Rank #2 (Buy). RCL has a trailing four-quarter earnings surprise of 28.3%, on average. Shares of RCL have surged 162.9% in the past year.
The Zacks Consensus Estimate for RCL’s 2024 sales and EPS indicates a rise of 13.7% and 38.1%, respectively, from the year-ago levels.