“Bring on the Roaring ’20s”: $97 target for LN stock
Financial research firm Wolfe Research has begun coverage of Live Nation, assigning the company’s stock an ‘outperform’ (ie strong buy) rating ahead of the resumption of live entertainment activity later this year.
In an announcement, titled ‘LYV: Bring on the Roaring 20s – Initiate with Outperform’, that the company is initiating coverage of Live Nation stocks (which trade on the New York Stock Exchange under the symbol LYV), Wolfe analyst John Janedis says the promoter is “poised for a multi-year cycle of strong growth as the reopening accelerates for a business that will have the tailwind of favourable supply/demand and a structurally stronger margin profile coming out of the pandemic”.
“LN will have the tailwind of favourable supply/demand and a structurally stronger margin profile coming out of the pandemic”
Channelling Marc Geiger in predicting a second “roaring twenties” for live entertainment, Janedis says he also sees Live Nation growing its already dominant market share post-Covid-19 “given its scale and vertical positioning within live entertainment”.
Wolfe has given Live Nation shares a price target of US$97 by the end of 2021. At press time, LYV stocks were worth $85.80; they reached an all-time high of $92.86 on 1 March.
Other analysts covering Live Nation stock include JP Morgan, William Blair, Morgan Stanley and Northcoast Research.
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Eventbrite reveals stock market launch details
Eventbrite expects its shares to be priced between US$19 and $21 when they are listed on the New York Stock Exchange (NYSE) later this year.
Documents filed with the US Securities and Exchange Commission (SEC) this afternoon reveal the San Francisco-based ticketing company will make available ten million shares of common stock, with an option for the purchase and sale of a further 1.5m reserved by underwriter Goldman Sachs.
Eventbrite filed for an initial public offering (IPO), or stock market flotation, on 24 August. It plans to raise $200m from the sale of 10m class-A shares – comprising around 1.5% of voting power, with the remaining 98.5% held by class-B stocks, which have ten times the voting rights – with a $19–21 share price generating $200m at the midpoint of that range.
According to the SEC filing, the proceeds of the stock market launch, scheduled for later in 2018, will be put towards repaying Eventbrite’s debts – including $30m from the September 2017 acquisition of Ticketfly – as well increasing its market capitalisation and financial flexibility. It estimates its market opportunity to be “1.1bn tickets generating $3.2bn in gross ticket fees, along with an additional 1.9bn free tickets”.
The proceeds of the IPO will be put towards repaying Eventbrite’s debts, including $30m owed to Ticketfly
Since 2006 Eventbrite, which describes itself as “the world’s largest event technology platform”, has raised $332.3m over nine funding rounds. It is presently unprofitable, although turnover continues to grow – sales increased 51% in 2017 – and net losses are decreasing (-4.7%, from $40.4m to $38.5m, in 2017). Its free cash flow is also positive.
“Great top-line numbers, while not burning cash, is kind of the dream,” Phil Haslett, CEO of EquityZen, an online marketplace for pre-IPO shares, tells Dow Jones Newswires, commenting on Eventbrite’s financial health.
Ahead of the IPO, venture-capital firms Sequoia Capital and Tiger Global each own more than 20% of Eventbrite’s class-B shares, while CEO Julia and chairman Kevin Hartz, the company’s husband-and-wife co-founders, own 17.4%.
Other live music companies listed on the NYSE include Live Nation, Madison Square Garden Company and StubHub owner eBay.
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