LYV

We rate Live Nation Entertainment, Inc. (LYV) as a Hold with a composite score of 64.8/100 at a current price of $157.55. The stock presents a mixed quantitative picture — neither compelling enough to warrant new accumulation nor weak enough to justify selling for existing holders. Our factors are split, and the overall profile suggests patience is warranted.

The rating is primarily driven by strength in stability (80th percentile) and value (72th percentile), which together account for the majority of the composite score. All factors score above the 40th percentile, indicating no material weakness in the quantitative profile. We assign a Narrow Moat rating (63/100), High uncertainty, and Poor capital allocation.

Key items to watch: balance sheet deleveraging progress; sustainability of the current growth rate. Any material change in these dynamics could warrant a reassessment of our rating. The moat trend is stable, which suggests the competitive landscape is stable for now.

Live Nation Entertainment, Inc. holds a mid-tier position (#35 of 50) within the Services sector, based on our composite quantitative scoring across quality, value, momentum, and stability factors. The composite score of 64.8/100 places it at rank #295 in our full 7,333-stock universe. With a $38.3B market capitalization, Live Nation Entertainment, Inc. operates at meaningful scale within the Services sector, providing competitive advantages in distribution, procurement, and customer reach.

The near-term outlook is constructive, with revenue growing at 41% and momentum in the 69th percentile confirming positive market sentiment and institutional accumulation. The combination of strong top-line growth and favorable price dynamics suggests the company is executing well on its growth strategy. Investment factor at the 44th percentile indicates reinvestment patterns that investors should monitor for sustainability.

The margin cascade tells an important story: gross margins of 27% (-32.7pp vs sector) narrow to operating margins of 7% (+3.5pp vs sector) and net margins of 4.5%, yielding a gross-to-net conversion rate of 17%. This conversion rate is typical for the sector, suggesting a standard cost structure without notable efficiency advantages or disadvantages.

At a current price of $157.55, Live Nation Entertainment, Inc. appears undervalued relative to its fundamentals. Our value factor score of 72/100 reflects a composite assessment across multiple valuation metrics including price-to-earnings, price-to-book, EV/EBITDA, and price-to-sales ratios relative to both sector peers and the broader market. The stock screens as attractively priced on a majority of these measures, suggesting the market may be underappreciating the underlying fundamentals.

The stock currently trades at a P/E of 28.1x (roughly in line with the sector median of 23.7x), EV/EBITDA of 14.3x (at a premium), P/B of 42.2x, P/S of 1.4x. The above-sector P/E multiple suggests the market is pricing in superior growth or quality, which our analysis partially supports given strong quality metrics.

We assign a High uncertainty rating to Live Nation Entertainment, Inc.. Key risk factors include significant leverage (2462% debt-to-equity), the combination of leverage (2462% D/E) and thin margins (4.5% net) amplifies downside risk. The wide range of potential outcomes widens our fair value estimate and increases the possibility of permanent capital impairment. Investors considering this name should size positions accordingly and demand a meaningful margin of safety before initiating.

Specific risk factors that inform our assessment include: significant leverage (2462% debt-to-equity); the combination of leverage (2462% D/E) and thin margins (4.5% net) amplifies downside risk. Each of these factors independently widens the distribution of potential outcomes, and in combination they create a risk profile that demands careful position sizing. The stability factor at the 80th percentile and quality factor at the 69th percentile provide a quantitative summary of the overall risk landscape.

Key risk mitigants include: above-average stability (80th percentile) suggests predictable business dynamics. These factors partially offset the identified risks and provide downside protection in adverse scenarios. On balance, the risk-reward profile warrants caution and disciplined position management.

We rate Live Nation Entertainment, Inc.'s capital allocation as Poor. Key concerns include elevated leverage (2462% D/E). Exemplary capital allocators generate ROE above 20% and maintain conservative leverage — Live Nation Entertainment, Inc. significantly underperforms these benchmarks, raising questions about management's ability to create shareholder value.

Investors should scrutinize management's reinvestment decisions and balance sheet trajectory before committing capital. Poor capital allocation often compounds over time: overlevered balance sheets limit strategic flexibility, while low returns on capital destroy shareholder value. We would need to see sustained improvement in profitability metrics and balance sheet discipline before considering an upgrade.

In summary, Live Nation Entertainment, Inc. receives a Hold rating with a composite score of 64.8/100 (rank #295 of 7,333). Our quantitative framework assigns a Narrow Moat (63/100, trend: stable), High uncertainty, and Poor capital allocation. The average factor score across quality, value, momentum, stability, and investment is 67/100.

Our analysis supports a neutral stance on Live Nation Entertainment, Inc.. While the quantitative profile is not weak enough to warrant selling, it lacks the multi-factor strength required for a buy recommendation. Existing holders should maintain positions and monitor for catalysts — either fundamental improvement or valuation compression — that would shift the risk-reward balance.