StubHub Rises as Analysts Support Eases Post-IPO Concerns
StubHub, a leading ticketing platform, saw its shares rise nearly 6% in early trading on October 13, following positive ratings from several brokerages. The initial uncertainty surrounding its IPO has been eased as analysts highlighted the company’s strengths in the secondary ticketing market and its plans to expand into direct issuance and advertising.
Analyst Support Boosts Confidence
Analysts from firms like J.P. Morgan and BofA Global Research have commenced coverage of StubHub, praising its strong position in the secondary ticketing market. They assert that this dominance could facilitate the company’s growth in the larger primary ticketing sector. The supportive ratings have rejuvenated investor sentiment after a lukewarm market debut last month.
Market Performance and Investor Sentiment
- StubHub shares opened at $20, below its IPO price of $23.50.
- The company raised approximately $800 million during its U.S. IPO.
- StubHub’s acquired debt stands at $2.4 billion, with IPO proceeds aimed at reducing this figure.
Despite a strong performance in secondary ticketing, some analysts note that investor confidence is still cautious, given that shares are trading at a discount compared to peers. However, J.P. Morgan’s analysts highlight an attractive risk/reward profile, indicating expectations for robust execution in its core resale and advertising services.
StubHub’s Market Presence
Founded in 2000, StubHub operates in over 200 countries, offering a marketplace for live event tickets, including sports and music performances. In 2020, it was acquired by Viagogo for $4.05 billion, marking its return to public markets after a series of delays. The recent IPO was managed by a 14-firm syndicate led by J.P. Morgan and Goldman Sachs.
Future Outlook
Analysts remain optimistic about StubHub’s potential. BMO has described it as a leader in the secondary ticketing market, suggesting it could disrupt the primary ticketing market. None of the brokerage firms that initiated coverage issued negative ratings, underscoring a generally positive outlook for the company.
