Liberty Media to Augment Stake in Live Nation Entertainment - Analyst Blog


Liberty Media Corporation ( LMCA ), which owns interests in a broad range of businesses including media, communications and entertainment, is planning to increase its stake in Live Nation Entertainment, Inc. ( LYV ). The company is keen on buying an additional 3.7 million shares of Live Nation Entertainment.

Liberty Media's intention to purchase Live Nation Entertainment was born after the latter proposed $500 million in convertible notes. Live Nation Entertainment is offering $250 million in convertible senior notes payable in 2019 and the remaining $250 million payable in 2022. Live Nation plans to use the proceeds for business purposes.

Liberty Media currently holds a 26% stake in Live Nation Entertainment, the largest concert promoter and ticketing company in the U.S. We believe the deal, if successful, will help to drive Liberty Media's earnings and revenues. It is worth noting that Live Nation Entertainment has performed reasonably well in the last one year. The company has surpassed the Zacks Consensus Estimate in three of the last four quarters with an average earnings surprise of 20.7%.

Liberty Media also holds a 53% stake in SIRIUS XM Radio. With nearly 25.6 million subscribers under its coverage, SIRIUS XM, the largest satellite radio service provider, is expected to provide huge financial synergies to Liberty Media over the long haul.

Liberty Media currently has a Zacks Rank #5 (Strong Sell). In the previously concluded quarter, the company reported dismal results with both the top and the bottom line missing the respective Zacks Consensus Estimate. Failing to acquire Time Warner Cable also came as a temporary blow that did not allow the company to gain strong traction in the U.S. cable industry.

Other Stocks to Consider

Better-ranked stocks worth considering in the media industry include The Walt Disney Company ( DIS ) and News Corporation ( NWS ). Both the stocks carry a Zacks Rank #2 (Buy).

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DISNEY WALT (DIS): Free Stock Analysis Report

LIBERTY MEDIA-A (LMCA): Free Stock Analysis Report

LIVE NATION ENT (LYV): Free Stock Analysis Report

NEWS CORP-B (NWS): Free Stock Analysis Report

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Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Business , Stocks

Referenced Stocks: DIS , LMCA , LYV , NWS

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