StubHub stock jumped Monday after Wall Street analysts initiated coverage of the company with a positive view. Shares of the online ticketing platform have mostly traded lower since the StubHub IPO last month.
At least 12 analysts have initiated coverage of StubHub stock since late Sunday, with 11 of the reports offering buy-equivalent calls, according to various media reports. One analyst had a neutral rating. The notes follow the end of a traditional quiet period for analyst coverage after StubHub's IPO last month.
StubHub stock is up nearly 5% at 19.82 in recent trades on the stock market today.
It has been rough going for StubHub stock since the New York-based ticketing platform completed its initial public offering on Sept. 17. Shares closed the first day 6% below StubHub's 23.50 IPO price. StubHub stock has mostly stumbled since then, closing trading last week down 20% from its IPO price.
But analysts on Monday offered a far more bullish views than its early performance would indicate. BofA analyst Justin Post gave StubHub a buy rating with a price target of 25.
"StubHub was founded in 2000 and has grown to become North America's largest secondary ticket marketplace with close to 50% share," Post wrote. "We expect healthy resale market growth, share gains, an emerging direct issuance business, and ad initiatives to drive revenue growth well above other internet marketplaces."
StubHub Stock: What Analysts Are Saying
Meanwhile, Evercore ISI analyst Mark Mahaney initiated coverage of StubHub stock with an outperform, or buy, rating. He set a price target of 29.
"As the dominant player in an online marketplace business (secondary ticketing), STUB produces robust financials (29% revenue growth in 2024) and benefits from scalable, asset-light economics with high margins (81% gross margins in 2024), very strong cash conversion, and powerful network effects," Mahaney wrote in a client note Monday.
Wedbush analyst Scott Devitt rated StubHub stock as outperform with a price target of 25.
"We see a multiyear runway of robust growth ahead of peers, primarily supported by an inflection in growth of the direct issuance segment in the coming periods," Devitt wrote.
Debate About StubHub's Direct Issuance Push
A major debate for investors about StubHub stock is the company's ability to grow its business directly issuing tickets, where it is more firmly up against giants like TicketMaster parent Live Nation. StubHub last month announced a deal that will allow Major League Baseball teams to sell tickets directly through StubHub.
Devitt estimated that direct issuance and unsold tickets represent a $127 billion total addressable market, compared with a $30 billion market for secondhand ticket sales.
"Over the next 12-24 months, investors will be focused on execution as the company aims to significantly expand the segment, attracting greater inventory allocation from both current partners and additional content rights holders," Devitt wrote.
But there is an "execution risk" as the company tackles the segment, the Wedbush analyst added.
What To Know About StubHub Stock
StubHub was cofounded by its current chief executive, Eric Baker, in 2000. It was acquired by eBay for $310 million in 2007. EBay sold StubHub in 2020 for roughly $4 billion to European ticket marketplace Viagogo, another company founded by Baker. The combined company became StubHub Holdings, led by Baker.
In its IPO filing, StubHub said its revenue climbed 29.5% in 2024 to $1.77 billion. Sales grew 10% in its March-ended first quarter to $397.6 million. The company posted a net loss of $22.2 million in Q1 of this year, as well as a net loss of $2.8 million for all of 2024.
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