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What's in the Cards for Live Nation's (LYV) Q1 Earnings?
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Live Nation Entertainment, Inc. (LYV - Free Report) is scheduled to report first-quarter 2018 results on May 3, after market close.
Live Nation delivered its seventh consecutive year of record results in 2017 with revenue growth across all its segments — concerts, sponsorship and ticketing. The company expects strong consumer demand, and decent supply of new and established artists to continue driving the top line. In fact, driven by a robust brand portfolio, Live Nation’s shares have rallied 22.2% in the past year, outperforming the broader industry’s gain of 0.8%.
Let’s discuss the factors that are likely to have affected the company’s first-quarter 2018 revenues and earnings.
Top Line Likely to Face Pressure Despite Sales-Building Efforts
Though Live Nation's various initiatives to drive sales encourage us, we remain slightly apprehensive of revenue growth in the first quarter. The company typically experiences lowest financial performance in the first and fourth quarters of the calendar year, as its outdoor venues are primarily used for festivals from May through October. Resultantly, the Zacks Consensus Estimate for first-quarter revenues is pegged at $1.34 billion, reflecting 5.4% decline from the prior-year quarter.
Nonetheless, various digital initiatives undertaken by Live Nation to improve ticket booking experience should continue to drive revenues, going forward. Meanwhile, sponsorship & advertising business has been well balanced with both parts of the business growing revenues in double digits throughout 2017.
High Costs to Dent Earnings
From these rigorous sales building efforts, Live Nation incurs high expenses. Especially since the first quarter is a slower volume quarter, the company’s cost burden is likely to increase. Also in 2017, total operating costs increased 27.4% year over year and the trend is likely to have continued in the first quarter as well.
Subsequently, per the consensus estimate, the company is anticipated to report a loss of 29 cents, showing a deterioration of 31.8% from the prior-year quarter.
Quantitative Model Prediction
Our proven model shows that Live Nation does not have the right combination of the two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or higher — for increasing the odds of an earnings beat in the first quarter. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks ESP: Earnings ESP, which represents the difference between the Most Accurate estimate and the Zacks Consensus Estimate, is -0.66%.
Zacks Rank: Live Nation has a Zacks Rank #3. Note that we caution against stocks with a Zacks Rank #4 or 5 (Sell-rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Here are some stocks from the Consumer Discretionary sectorthat investors may consider, as our model shows that they have the right combination of elements to post an earnings beat in the to-be-reported quarter:
Earnings ESP for Walt Disney (DIS - Free Report) , Marriott (MAR - Free Report) and Discovery Communications is +1.34%, +0.40%, +0.39%, respectively. While Walt Disney and Marriott carry a Zacks Rank #3, Discovery Communications holds a Zacks Rank #2 (Buy). All the companies are scheduled to report quarterly numbers on May 8.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
Image: Bigstock
What's in the Cards for Live Nation's (LYV) Q1 Earnings?
Live Nation Entertainment, Inc. (LYV - Free Report) is scheduled to report first-quarter 2018 results on May 3, after market close.
Live Nation delivered its seventh consecutive year of record results in 2017 with revenue growth across all its segments — concerts, sponsorship and ticketing. The company expects strong consumer demand, and decent supply of new and established artists to continue driving the top line. In fact, driven by a robust brand portfolio, Live Nation’s shares have rallied 22.2% in the past year, outperforming the broader industry’s gain of 0.8%.
Let’s discuss the factors that are likely to have affected the company’s first-quarter 2018 revenues and earnings.
Top Line Likely to Face Pressure Despite Sales-Building Efforts
Though Live Nation's various initiatives to drive sales encourage us, we remain slightly apprehensive of revenue growth in the first quarter. The company typically experiences lowest financial performance in the first and fourth quarters of the calendar year, as its outdoor venues are primarily used for festivals from May through October. Resultantly, the Zacks Consensus Estimate for first-quarter revenues is pegged at $1.34 billion, reflecting 5.4% decline from the prior-year quarter.
Nonetheless, various digital initiatives undertaken by Live Nation to improve ticket booking experience should continue to drive revenues, going forward. Meanwhile, sponsorship & advertising business has been well balanced with both parts of the business growing revenues in double digits throughout 2017.
High Costs to Dent Earnings
From these rigorous sales building efforts, Live Nation incurs high expenses. Especially since the first quarter is a slower volume quarter, the company’s cost burden is likely to increase. Also in 2017, total operating costs increased 27.4% year over year and the trend is likely to have continued in the first quarter as well.
Subsequently, per the consensus estimate, the company is anticipated to report a loss of 29 cents, showing a deterioration of 31.8% from the prior-year quarter.
Quantitative Model Prediction
Our proven model shows that Live Nation does not have the right combination of the two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or higher — for increasing the odds of an earnings beat in the first quarter. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks ESP: Earnings ESP, which represents the difference between the Most Accurate estimate and the Zacks Consensus Estimate, is -0.66%.
Zacks Rank: Live Nation has a Zacks Rank #3. Note that we caution against stocks with a Zacks Rank #4 or 5 (Sell-rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Live Nation Entertainment, Inc. Price and EPS Surprise
Live Nation Entertainment, Inc. Price and EPS Surprise | Live Nation Entertainment, Inc. Quote
Stocks to Consider
Here are some stocks from the Consumer Discretionary sectorthat investors may consider, as our model shows that they have the right combination of elements to post an earnings beat in the to-be-reported quarter:
Earnings ESP for Walt Disney (DIS - Free Report) , Marriott (MAR - Free Report) and Discovery Communications is +1.34%, +0.40%, +0.39%, respectively. While Walt Disney and Marriott carry a Zacks Rank #3, Discovery Communications holds a Zacks Rank #2 (Buy). All the companies are scheduled to report quarterly numbers on May 8.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
Click for details >>