Live Nation Entertainment, Inc. (NYSE:LYV): Are Analysts Optimistic?

By
Simply Wall St
Published
June 03, 2021
NYSE:LYV
Source: Shutterstock

With the business potentially at an important milestone, we thought we'd take a closer look at Live Nation Entertainment, Inc.'s (NYSE:LYV) future prospects. Live Nation Entertainment, Inc. operates as a live entertainment company. With the latest financial year loss of US$1.7b and a trailing-twelve-month loss of US$1.8b, the US$20b market-cap company amplified its loss by moving further away from its breakeven target. As path to profitability is the topic on Live Nation Entertainment's investors mind, we've decided to gauge market sentiment. In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

Check out our latest analysis for Live Nation Entertainment

According to the 14 industry analysts covering Live Nation Entertainment, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2021, before generating positive profits of US$243m in 2022. Therefore, the company is expected to breakeven just over a year from now. How fast will the company have to grow each year in order to reach the breakeven point by 2022? Working backwards from analyst estimates, it turns out that they expect the company to grow 58% year-on-year, on average, which signals high confidence from analysts. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

earnings-per-share-growth
NYSE:LYV Earnings Per Share Growth June 4th 2021

Given this is a high-level overview, we won’t go into details of Live Nation Entertainment's upcoming projects, but, keep in mind that generally a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

One thing we would like to bring into light with Live Nation Entertainment is it currently has negative equity on its balance sheet. Accounting methods used to deal with losses accumulated over time can cause this to occur. This is because liabilities are carried forward into the future until it cancels. These losses tend to occur only on paper, however, in other cases it can be forewarning.

Next Steps:

There are too many aspects of Live Nation Entertainment to cover in one brief article, but the key fundamentals for the company can all be found in one place – Live Nation Entertainment's company page on Simply Wall St. We've also put together a list of key factors you should look at:

  1. Valuation: What is Live Nation Entertainment worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Live Nation Entertainment is currently mispriced by the market.
  2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Live Nation Entertainment’s board and the CEO’s background.
  3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

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This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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Simply Wall St is focused on providing unbiased, high-quality research coverage on every listed company in the world. Our research team consists of data scientists and multiple equity analysts with over two decades worth of financial markets experience between them.