Live Nation Entertainment’s stock, which trades under the symbol LYV, experienced a big boost in price yesterday, June 15, to $12.35 per share, a healthy gain of more than 4.5 percent following a drop of more than 30 percent less than a month ago.
Stocks, in general, saw gains yesterday as financial markets were buoyed by news out of Europe that the region’s debt situation may be improving slightly. But, Live Nation’s percentage gain still more than doubled the 2.1 percent increase in the Dow Jones industrial average, and it was more than 2 percentage points ahead of the S&P 500’s spike of 2.4 percent. As of about 3 p.m. EST today, June 16, Live Nation’s stock gave back about 9 cents per share of that gain and was trading at about $12.26 per share.
There could be any number of reasons for the increase in stock price, including the nature cycle after such a heavy drop in the weeks prior.
“I think it will trade with the market, with more volatility on either side – and [with] a bias to the upside as our rating is Overweight and our target price is above current levels – until we get another piece of news,” Ben Shapiro, research analyst with Thomas Weisel Partners, told TicketNews.
But, the stock gain comes at an important time for Live Nation, which finds itself facing challenges on more than one front.
Several major acts have cancelled shows or whole tours this year, which will affect Live Nation’s ticket sales this summer, traditionally the industry’s strongest period. And, the company has launched an aggressive program of waiving convenience fees on tickets for dozens of shows this summer.
Both U2 and Christina Aguilera postponed major tours until next year, and John Mayer was forced to cancel some shows due to illness. In addition, The Eagles, Limp Bizkit and Rihanna also put off some shows this summer.
In addition, the company’s paperless ticket model, under its Ticketmaster division, has come under fire from legislators in both New York and New Jersey, two of the nation’s largest live entertainment markets.