Live Nation’s share price reaches all-time high
The share price of live entertainment behemoth Live Nation has scaled new heights this week, despite the fact the vast majority of live shows have not been able to take place for the past 10 months.
On Tuesday (19 January), Live Nation’s share price hit an all-time high of US$76.54 – which has more than doubled since its slump to $29.50 in March last year, amid the cancellations and postponements of live shows.
The record-high share price comes after the company acquired a majority stake in Veeps, a ticketed livestreaming platform developed by Good Charlotte’s Joel and Benji Madden.
Veeps is Live Nation’s first major acquisition since the pre-Covid-19 era and a strong indication that livestreamed concerts are here to stay.
Live Nation’s share price hit an all-time high of $76.54 after the live entertainment giant acquired a majority stake in Veeps
“Livestreaming is a great complement to our core business, and essentially gives any show an unlimited capacity,” said Live Nation CEO, Michael Rapino.
“Looking to the future, live streams will continue to unlock access for fans – whether they are tuning into a sold-out show in their hometown, or watching their favourite artist play in a city halfway around the world. The most critical element of live streaming is the artist on stage, and with Live Nation’s unmatched inventory feeding into Veeps, together we will help fans enjoy more live music than ever before.”
Live Nation’s stock has steadily climbed after its 52-week low in March 2020, with the company offering drive-in shows, live streams, and new content through its Live From Home virtual music hub throughout the pandemic.
In November last year, following early results from the world’s first effective coronavirus vaccine, Live Nation share price soared by 22%.
Prior to that, Live Nation-owned Ticketmaster unveiled SmartEvent, a new suite of technology will equip event organisers to meet the evolving needs of capacity, distancing and other logistics.
Live Nation’s share price stood at $74.59 yesterday (21 January).
Public live cos add nearly $6bn since March crash
The main publicly listed live entertainment companies have added US$5.75 billion – or nearly $1bn a month – to their collective value since the worst of the Covid-19-induced stock-market crash in March, new analysis reveals.
Combining the market capitalisations of Live Nation, CTS Eventim, DEAG, Time for Fun and Eventbrite, as well as a relevant percentage of Vivendi’s business, shows the six companies were worth nearly $6bn more on 21 September than 20 March, in spite of the six-month-and-counting shutdown of nearly all live experiences.
As in previous IQ coverage of live music’s (pre-coronavirus) stock-market performance, Live Nation Entertainment – the world’s biggest live entertainment business – is the biggest mover, growing its market cap by nearly 60% in the period analysed.
Worth $7.29bn on 20 March, with a share price of $33.97, Live Nation (LYV)’s market cap stood at $11.55bn six months later, with most financial analysts confident the concert behemoth will bounce back strongly post-pandemic. As of 9 September, of the 12 firms covering Live Nation stock, seven have assigned it a ‘buy’ rating, one a ‘strong buy’ and one a ‘hold’, with none recommending a ‘sell’.
While the recovery of Live Nation – which has made an estimated $600m in savings this year, believed to include widespread redundancies globally – is impressive, five of the six businesses included have rebounded strongly over the last six months, with only DEAG shares having declined in price as of 21 September.
Berlin-based Deustche Entertainment AG (LOUD), which trades on Frankfurt’s Xetra exchange, had around $11 million (€9.4m) shaved off its market cap after the value of its stocks fell from €3.48 on 20 March to exactly €3 on 21 September. As of the latter date, DEAG’s market capitalisation was €58.9m ($68.9m), down around 14% on €68.3m ($79.9m) six months previous.
Live Nation is the biggest mover, growing its market cap by nearly 60% in the period analysed
Yet DEAG stock, too, is strongly rated by market watchers: analysts’ ratings similarly lean heavily towards a ‘buy’, with even the most pessimistic financial observers giving the company’s stock a price target of €3.50 in the short term (while noting that DEAG should “return to pre-corona levels” by 2022).
Of the other four businesses, another German company, public pan-European concert and ticketing giant CTS Eventim, was the stand-out performer, growing its market cap more than $1bn by adding nearly €10 to its share price.
Compared to 20 March, when its share price was €31.78 and market cap €3.05bn, CTS Eventim (EVD) shares traded at €41.14 six months later, giving the company a market capitalisation of €3.95bn at the time of writing.
Brazil’s Time for Fun/T4F Entertainment (SHOW3) – the largest promoter in South America – has seen its value increase 42%, from R$131m ($23.8m) to R$186.1m ($33.8m), while US-based self-service and club ticketing specialist Eventbrite (EB) is up 61%, growing its market cap from $649.2m to $1.06bn in the same period.
French media conglomerate Vivendi (VIV), meanwhile, has seen its market cap rise from an estimated €20.9bn in March to €26.38bn on 21 September. The company’s Vivendi Village unit – which incorporates its live (Olympia Production, U Live, festivals and venues in France and Africa) and ticketing (See Tickets, Starticket, Paylogic) businesses – accounts for some 0.34% of the business: €26m in revenue, of €7.58bn total, per its H1 2020 report.
Many outside observers agree live music’s recovery will be complete by 2022
While it should be noted the industry is far from back to its pre-Covid-19 value – Live Nation stocks were once worth nearly $75, while Eventim shares hit a high of €60 in January – the rally bodes well for a sector often described as the first to close and last to reopen, and which has been hit particularly hard by the impact of the virus.
Additionally, the live music industry welcomed two newly public businesses – MSG Entertainment, spun off from the Madison Square Garden Company, and Warner Music Live/Umbrella Artists owner Warner Music Group, which floated in April and June, respectively – in the same period, and which would likely have pushed the $5.75bn figure even higher were those companies trading in March.
With so-called second lockdowns looming in many territories, it remains unclear how global markets will perform in the months ahead, as well as the effects, positive or otherwise, any volatility will have on live music stocks.
One thing, however, many outside observers seem to agree on is that live music’s recovery will be complete by 2022.
As IQ revealed earlier this month, financial consulting firm PricewaterhouseCoopers (PwC) is predicting a complete recovery by 2022, with the value of the live music market (public and private) set to reach $29.3bn – over $300m more than 2019’s $28.97bn – that year, while investment bank Goldman Sachs is similarly bullish, with its head of European media research, Lisa Yang, also heralding a return to normal in 2022.
Read PwC’s live music growth predictions here:
Live Nation share price breaks $50 mark
The price of a single Live Nation share has risen above US$50 for the first time, amid speculation by Wall Street analysts that the concert giant could be the target of an acquisition by satellite radio provider SiriusXM.
Shares in Live Nation (LYV) have grown at a remarkable rate throughout 2017 and 2018, reaching $40 in August 2017 – just six months after passing the $30 mark – although the price dipped 13% earlier this year after a New York Times article claimed the company was being investigated by the US Department of Justice for alleged anti-competitive behaviour.
It has since rebounded from a six-month low of $36, bolstered by positive indications for 2018, a recent run of acquisitions and the potential for a SiriusXM takeover, suggests Citigroup analyst Jason Bazinet.
According to financial services company the Motley Fool, “the biggest driver of market buzz came from analyst firm Citigroup suggesting that Sirius XM Holdings might want to buy out Live Nation someday soon.”
Combining Live Nation/Ticketmaster and SiriusXM, says Bazinet, would create a “vertically integrated music titan”
SiriusXM parent company Liberty Media – which owns roughly a third of Live Nation – has been vocal about the synergies between combining Live Nation/Ticketmaster and SiriusXM, says Bazinet, which would create a “vertically integrated music titan”.
Additionally, he says, the merger would face fewer regulatory challenges than the joining together of Live Nation and Ticketmaster, as the companies operate in different sectors of the music business.
However, Sebastiano Petti, an analyst at JPMorgan, suggests a deal is unlikely, noting that Liberty has talked about synergies between the companies previously without launching an acquisition bid.
At press time, Live Nation’s share price stood at $49.82.
LiveXLive to list on Nasdaq
Shares of common stock in live music video company LiveXLive have been approved for listing on the Nasdaq Capital Market.
Shares are expected to begin trading today (22 February) on the Capital Market, the New York stock exchange’s small-cap equity market, under the symbol LIVX.
LiveXLive chairman and CEO Rob Ellin comments: “2017 was a monumental year for LiveXLive and listing on Nasdaq is an exciting and major milestone in our evolution that we believe will expose the company to a wider audience of potential institutional investors and increase liquidity, ultimately contributing to our ability to increase shareholder value.
“Consumers demand accessible, world-class experiences and LiveXLive has built a platform for just that – a social ecosystem for music lovers around the world. Backed by an impressive management team and propelled by the incredible market opportunity, we have built a company that uniquely addresses a previously untapped market.
“Listing on Nasdaq is an exciting and major milestone in our evolution”
“We look forward to continuing to share our developing story with the investment community.”
LiveXLive, which launched in July 2015, initially positioned itself as the “ESPN of premium live music experience” with its aim of creating a 24-hour network of live music broadcasting digitally and on mobile. Last May it signed a strategic partnership with MTV to provide the broadcaster with LiveXLive’s stream of the closing night of Rock in Rio Lisbon (partnerships with Live Nation’s Outside Lands and AEG’s Hangout have followed since), and shortly after moved into ticketing with the acquisition of Wantickets following that company’s top brass’s controversial defection to Eventbrite.
It has since moved more into original content, with plans to develop a slate of “music news programming, documentaries, specials, and long- and short-form content”, and also recently launched a management division, LiveXLive Influencers, focusing on social-media stars. In September, it announced plans to acquire internet radio service Slacker Radio.
CTS exclusive ban confirmed…as market cap tops €4bn
Germany’s Federal Cartel Office has published details of its controversial ruling banning CTS Eventim’s exclusivity agreements with promoters and box offices, mandating that at least 20% of ticket inventory from the company’s partners be available to other ticket sellers.
The decision, which can be read (in German) on the Bundeskartellamt website, gives formerly Eventim-exclusive promoters the option of allocating at least 20% of their annual ticket inventory to other ticket agencies, providing the term of their agreement is more than two years (or indefinite).
CTS Eventim is therefore required to either adjust or terminate all existing agreements, although the German ticketing giant – Europe’s largest – says it still plans to appeal the ruling.
“The decision of the Federal Cartel Office ignores the fierce competition in the market for ticket services”
“The decision of the Federal Cartel Office ignores the fierce competition in the market for ticket services, which is constantly increasing as a result of frequent entries into the market by digital [ticketing companies] from Germany and abroad,” says a spokesperson.
While it remains to be seen whether the Bundeskartellamt decision, along with a previous edict prohibiting the company’s takeover of promoter Four Artists, will hurt CTS’s ticketing business, the attention from regulatory authorities has failed to dent its share price: Friday saw the company’s market cap top the €4 billion mark for the first time since its floatation in 2000.
According to financial newswire dpa-AFX, 80% of analysts recommend buying CTS stock, with the remaining 20% suggesting holding.
Berchtold, Willard, Rowles re-up with Live Nation
Live Nation’s Joe Berchtold, Michael Rowles and Kathy Willard have followed CEO Michael Rapino in extending their contracts with the company until 2022.
Berchtold, formerly chief operating officer, becomes president – a role also held by president/CEO Rapino, who recently extended his tenure with Live Nation until 31 December 2022 – while Rowles and Willard remain in their current roles as executive vice-president, general counsel and secretary, and executive vice-president and chief financial officer, respectively.
As president, Berchtold will receive a base salary of $1.3m annually, along with a 200% performance bonus and a grant of 100,000 restricted shares and 300,000 performance-based shares.
Rowles, meanwhile, receives a base salary of $800,000, a 100% performance bonus and 25,000 restricted shares, while Willard receives a $950,000 base salary, a 100% performance bonus, 50,000 restricted shares and a grant of 50,000 options to purchase Live Nation common stock.
Live Nation’s share price currently stands at $43.37, after having broken the $40 mark for the first time in August
That compares to $9m per annum ($3m base salary + $6m in bonuses) and a grant of 289,505 shares in restricted Live Nation stock for Rapino.
Live Nation’s share price currently stands at $43.37, after having broken the $40 mark for the first time in August.
Live Nation Entertainment, now the world’s largest live entertainment company, continues to grow, both financially – it is on course for a seventh consecutive year of record growth, turning over $3.6bn in Q3 2017 – and in scope through buy-outs, joint ventures and partnerships: The company has made 17 acquisitions or equivalent in the past two years alone, the most recent being the Bank of New Hampshire Pavilion in Gilford, New England.
Live Nation Q2 results: shares soar $10 in six months
Shares in Live Nation Entertainment have topped the US$40 mark for the first time, as the live entertainment giant posted strong quarterly results for the second quarter (Q2) of 2017.
Live Nation’s concerts business was in Q2 once again its earnings “flywheel”, president and CEO Michael Rapino told investors yesterday, with a record 7,000+ shows and ticket sales of 24 million – up 5.5m year on year – driving concert revenue of US$2.25 billion, a 34% increase on Q2 2016. Adjusted operating income (which measures income before acquisition and stock expenses, depreciation and loss/gains incurred from the disposal of assets) from concerts grew 51%, to $88 million.
There were also solid gains in sponsorship and advertising, with revenue up 31% and AOI up 21%, and Ticketmaster, which grew turnover 9% to $484.6m and gross transaction value (GTV) by 8%.
Rapino (pictured) noted that ticketing growth was, however, negatively “impacted by the shift in concert onsales to the first quarter” but said Ticketmaster is seeing great success from its new Verified Fan presale system, which has seen a “dramatic reduction in these tickets then being sold on secondary sites” – and the continued blurring of the lines between primary and secondary market tickets.
“2017 is on track to be another year of growth and record results for the company”
“Our success at Ticketmaster starts with providing fans with the best solution to their ticketing needs,” he explained. “Building on our integration of primary and secondary tickets, we have now expanded our listings to also include secondary tickets to shows for which Ticketmaster is not the primary ticketer, all purchased through the same checkout flow. This has now increased the number of events we have listed by 35%, further leveraging the 120 million fans visiting our online sites per month.”
Total revenue for the entire Live Nation group in Q2 grew 29%, to $2.82bn. AOI was $221.4m.
Live Nation stocks jumped 5.6% following the earnings calls, pushing the share price above $40 for the first time – just six months after they passed the $30 mark.
At the close of the New York Stock Exchange last night, a single share in Live Nation Entertainment cost $40.25.
Commenting on Q2’s results, Rapino concluded: “2017 is on track to be another year of growth and record results for the company. Our key indicators for our businesses – concert tickets sold for shows this year, contracted sponsorship and fee-bearing ticketing GTV – are all pacing double digits ahead of last year and as a result we expect each of our businesses to deliver record revenue, operating income and AOI this year.”
Arena Group to float on London Stock Exchange
Event infrastructure supplier Arena Group has announced plans for a stock market launch.
The multinational company, which supplies temporary structures, seating and project management services to large-scale live events, will list its shares on the London Stock Exchange (LSE) and hopes to raise approximately £60 million to grow its business.
Arena Group’s live-entertainment clients include Lollapalooza in Chicago, the Jockey Club (whose Jockey Club Live divisions promotes shows at racecourses around the UK) and BFI, for which the company last year designed a pop-up cinema venue. It in April acquired Wernick Group’s seating division, rebranding it Arena Seating.
“I am delighted to announce that our plans to apply for admission to AIM [LSE’s Alternative Investment Market] are moving ahead, as it marks a key milestone in the development of the group. We believe the listing will not only raise our international profile but will also enable us to provide additional incentives, by way of a share option scheme, for our senior executive team around our global operations.
“We look forward with confidence to this next stage in Arena Group’s development”
“The new funding leaves us with a significantly stronger balance sheet and provides us with the necessary funding, as well as access to further capital, to will help us to continue to grow the business both organically and by way of potential acquisitions.
“We are very fortunate to have a loyal and dedicated workforce of 750 employees across our 14 international bases, and the successful floatation of the group is a testament to their hard work and support going back many years.
“We look forward with confidence to this next stage in Arena Group’s development.”
Sillerman upbeat as Function(x) is delisted
As threatened at the beginning of June, former SFX Entertainment CEO Robert Sillerman’s new online news business, Function(x), has been delisted from the Nasdaq stock exchange, with trading in its stock suspended from opening of business today.
The business has yet to file an up-to-date quarterly report (10-Q) – which under Nasdaq rules constitutes a “public information failure” – and said in a recent filing it anticipates defaulting on US$3 million promissory note, in a scenario reminiscent of the financial problems that plagued the final months of SFX, which collapsed under a mountain of debt last February.
In a new 8-K filing, Function(x) – which has been rapidly buying up much of the online ‘viral content’ (clickbait) market – says it will continue trading stocks ‘over the counter’, or off-exchange, without the supervision of the Nasdaq.
“The company came to the conclusion that the overhang of uncertainty, and the continuing expense related to these issues, were an unnecessary cost and distraction as we execute on our vision,” says Sillerman. “Nothing has changed in our stated goals to become the preeminent digital media publisher.
“Nothing has changed in our stated goals to become the preeminent digital media publisher”
“We intend to file our 10-Q in the near term, and follow all necessary steps to both be a responsible and productive public company and accelerate our growth trajectory.”
Simply Wall St, a website which provides market advice to investors, isn’t so confident: It suggests Function(x) has a “concerning amount of debt” and may be at risk of succumbing to its debt load. According to the site, Function(x)’s operating cashflow remains at around -100% of its debt, with a debt-to-equity ratio of 279.8%.
“Clearly, Function(x) has a concerning amount of debt on its balance sheet,” writes Simply Wall St’s Arjun Bhatia. “Additionally, the company fails to impress in terms of generating strong enough operating cashflows and earnings to cover annual interest expenses. Thus, for now, I don’t find it a financially sound company.”
Function(x)’s stocks have fallen in value by almost 50% in last 30 days, from a high of $0.70 on 26 May to $0.39 today.
Function(x) threatened with Nasdaq delisting
Function(x), the rapidly expanding online news business led by ex-SFX Entertainment CEO Robert FX Sillerman, has been threatened with delisting from the Nasdaq for the non-filing of financial information.
Function(x) has yet to submit a form 10-Q – a quarterly financial report which must be filed with the Securities and Exchange Commission (SEC) by all public companies in the US – for the latest quarter, and will be delisted unless it “requests a hearing before the Nasdaq hearings panel”, the New York stock exchange announced today.
The company contacted Nasdaq yesterday to request a hearing, which automatically delays its delisting for a period of 15 days.
A separate form, 8-K – which notifies shareholders of any significant events that may affect their investment – reveals Function(x) will ask Nasdaq for an extended delay from delisting while it gets its affairs in order, although it notes “there can be no assurance that the stay will be extended or that the panel will ultimately grant the company’s request for continued listing on Nasdaq”.
The late filing of Function(x)’s quarterly accounts, reveals the 8-K, constitutes a “public information failure”.
“The company does not anticipate it will be able to pay the note on the due date and therefore will be in default”
This means the company will be obliged to pay one of its creditors – the holder of US$3 million promissory note, issued following its recent acquisition of Rant, Inc. – “an amount in cash equal to one percent (1%) of the greater of the product of (A) the aggregate number of shares of common stock which the holder is entitled to convert pursuant to the [promissory] note and (B) the closing bid price of the common stock on the trading day immediately preceding the public information failure”. (That was, according to the document, 24 May, when its share price stood at $0.66 – it’s now around $0.62.)
Payment is due on “on the earlier of the last day of the month in which the public information failure occurred and the third business day after the failure is cured” – by our calculations, 31 May. According to the form, Function(x) “does not anticipate it will be able to pay the note on the due date” and “therefore will be in default under the note on the date that is five business days following the due date”.
Sillerman’s previous venture, EDM promotion conglomerate SFX Entertainment, collapsed under a mountain of debt last February, since being revived under new management as LiveStyle Inc.