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Live music giants enjoy big stock market gains

Shares in Live Nation, CTS Eventim and MSG Entertainment have soared on the back of recent financial projections

By James Hanley on 22 May 2023

Crowds gather at Download Pilot for Bullet for My Valentine's headline slot

It has been a strong week for touring power players on the stock market, with Live Nation, CTS Eventim and Madison Square Garden (MSG) Entertainment all seeing significant gains.

Billboard‘s Global Music Index increased 4.4% to 1,256.06, with 15 of the 21 stocks showing an upswing over the past week. Shares in concert giants LN and CTS were up 8.4% and 9.2% respectively, spurred by recent positive financial results for Q1 2023.

Live Nation posted revenue of $3.1 billion (€2.8bn) for the first quarter – up 73% on the corresponding period 12 months ago – with record results across all divisions. The earnings call prompted a notable uptick in the company’s share price, increasing from $66.76 to $75.91. The stock has since soared a further 12%, standing at $85.13 at press time, boosted by a bullish forecast by CEO Michael Rapino.

“What is clear as we look at our results and operating metrics is that global demand for live events continues to reach new heights – demand has been growing for a long time and is showing no signs of letting up,” said Rapino. “We expect to host a record number of fans this year, even against a 2022 comparison which benefited from rescheduled shows attended by 20 million fans.”

“The results show that live entertainment remains as popular as ever”

It is a similar story at pan-European giant CTS, which reported last week that ticket sales were up 58% on 2022, while consolidated revenue rocketed 163% year-on-year to €366.2m. Shares in the German-headquartered firm jumped 3% to €62.60 and have continued on an upward curve to €64.75.

“The results show that live entertainment remains as popular as ever,” said CEO Klaus-Peter Schulenberg. “Our customers have high expectations when it comes to buying tickets – especially for tours featuring top acts – and we have comfortably met these expectations. Both in Germany and internationally, we are pursuing organic growth and anticipate that our business performance will continue on its successful course.”

But it was MSG Entertainment, which reported a 4% year-on-year rise in revenues to $201.2m for the fiscal 2023 third quarter – its first as a standalone company following its spin-off from Sphere Entertainment – that experienced the biggest uplift. Shares leapt a huge 19.4% amid rumours it is negotiating a $1 billion deal to sell the former Hulu Theater, as Guggenheim initiated coverage of the company with a buy recommendation. The share price increased a further 2% today to $36.54.

“With the completion of our spin-off, MSG Entertainment begins its new chapter as a standalone, pure-play live entertainment company,” said executive chairman and CEO James L. Dolan. “We remain confident in the strength of our assets and brands and believe that we are well-positioned to create long-term value for shareholders.”

“We remain confident that this next chapter for our company will drive long-term shareholder value”

Shares in Sphere Entertainment also improved 6.1% last week and a further 1% today to $24.97. The firm reported an operating loss of $70.3m for fiscal Q3 on revenues of $363.3m.

“As we approach the opening of Sphere in Las Vegas, we remain confident that this next chapter for our company will drive long-term shareholder value,” said Dolan.

Billboard also reports that share prices for HYBE, SM Entertainment, YG Entertainment and JYP Entertainment have increased by an average of 75% year to date.

Elsewhere, Anghami, the largest music streaming service in the Middle East and North Africa (MENA), which acquired Dubai-based event management company Spotlight Events, climbed 1.7% and stands at $1.26.

UK-based music company ATC, which on the Aquis Growth Market in London in December 2021, has also seen its share price rise from £90 (€103.50) to £92.50 over the past month. The firm bettered its own expectations to record a profit on revenue of £12.1 million (€13.9m) in its first full year as a a public company.

“We are delighted with the progress we have made in our first year as a PLC, delivering 33% top line growth and profitability earlier than expected, whilst also investing in a number of important strategic developments for the group,” said ATC Group plc CEO Adam Driscoll.

 


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