Live Nation a Rare Winner as Music Stocks Have Tough Week
Written by djfrosty on May 10, 2024
Live Nation was the top-performing music stock and one of four stocks in positive territory this week. The concert promoter gained 2.5% to $97.02 while three other concert promotion stocks — Sphere Entertainment Co., Madison Square Garden Entertainment and CTS Eventim — each lost ground.
The Billboard Global Music Index fell 1.9% to 1,788.83 as 16 of its 20 stocks finished the week in negative territory. Music streaming companies Deezer and Anghami were two of the week’s other big winners with gains of 1.0% and 0.9%, respectively. Still, the index has risen 16.6% year to date and 12 of the 20 stocks have posted gains in 2024.
Another notable gainer this week was Believe, which closed Friday at 15.04 euros ($16.21), up 0.3% from the prior week. A closing price of 15.04 euros is above the 15.00 euros offer price by consortium of investors that aims to take Believe private. Some minority shareholders may remain, however, because the consortium, which has lined up 71.92% of share equity, will not implement a squeeze-out and force shareholders representing the remaining 28.08% of share capital to sell.
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iHeartMedia shares declined 42.7% to $1.30, leaving the radio broadcaster with a market capitalization of just $194 million. Its shares fell 36.1% on Thursday following its first-quarter earnings release and dropped another 5.8% on Friday.
As streaming has surged in popularity and economic importance, radio companies have struggled to reinvent themselves. In 2021, iHeartMedia shares surpassed $28 after the advertising market recovered from a COVID-19 pandemic-related collapse. But in the subsequent three years, its shares have lost nearly all their value as sluggish radio advertising has overshadowed iHeartMedia’s budding podcast business.
The index didn’t fall further than 1.9% because many of its most valuable companies suffered only minor losses this week. Spotify, the largest contributor to the float-adjusted index, dropped only 0.5% while HYBE, one of the index’s more valuable components, fell just 1.5%.
Those small losses, and Live Nation’s 2.5% gain, helped offset larger losses by some other valuable components of the index. Universal Music Group fell 3.1% to 28.01 euros ($30.22) and Warner Music Group dropped 7.3% to $31.64 following its fiscal second quarter earnings release on Thursday. Evercore and Morgan Stanley both dropped their price targets by $2 on WMG’s stock on Friday. Guggenheim maintain its WMG price target.
While music stocks had a rough week, stocks were broadly up around the world. In the United States, the S&P 500 gained 1.9% to 5,222.68 and the Nasdaq composite improved 1.1% to 16,340.87. In the United Kingdom, the FTSE 100 rose 2.7% to 8,433.76. South Korea’s KOSPI composite index gained 1.9% to 2,727.63. China’s Shanghai Composite Index rose 1.6% to 3,154.55.