Live entertainment company Madison Square Garden Entertainment Corp. (NYSE: MSGE) presents or hosts events at its venues, including New York’s Madison Square Garden, Hulu Theater at Madison Square Garden, Radio City Music Hall and Beacon Theatre, and The Chicago Theatre.
Additionally, the New York-based company runs two regional sports and entertainment networks, MSG Network and MSG+, which offer live sports content and other programs.
On May 9, Madison Square reported mixed financial results for the fiscal third quarter ended March 31, 2022. Following the results, shares of the company declined 10.1%.
Let’s take a closer look at the company’s performance.
Q3 Results
Even though the company’s loss narrowed to $0.51 per share from $0.79 per share in the year-ago quarter, it missed analysts’ earnings estimate of $0.04 per share.
Meanwhile, revenues surpassed expectations of $441.64 million and stood at $460.1 million. The figure is more than double the year-ago revenues of $214.3 million.
The Entertainment segment’s revenue rose to $194.6 million from $31 million a year ago. Revenue of the MSG Networks segment declined 6% year-over-year to $167.6 million.
Further, the Tao Group Hospitality segment generated revenues of $108.6 million during the third quarter versus $12.8 million in the prior-year quarter.
Management Comments
The Executive Chairman and CEO of Madison Square Garden Entertainment, James L. Dolan, said, “We are pleased with the positive momentum we are seeing across our business and are confident that our company is well-positioned to capitalize on the strong demand for live experiences. At the same time, we continue to prepare for the opening of MSG Sphere in Las Vegas in the second half of calendar 2023, which we believe will set the stage for long-term value creation for our shareholders.”
Wall Street Weighs In
After the results were announced, Jefferies (NYSE: JEF) analyst David Katz maintained a Buy rating on the stock with a price target of $100 (62.6% upside potential).
The analyst said, “Our view of the core live entertainment business outlook is positive and expect trends to continue as the demand for experiential assets remains robust. Additionally, the company’s multi-year agreements and other sponsorships provide meaningful opportunities through 2023.”
Based on one Buy and one Hold, the stock has a Moderate Buy consensus rating. MSGE’s average price target of $85.50 implies 39.1% upside potential from current levels. Shares have lost almost 30% over the past year.
Bloggers Bullish
TipRanks data shows that financial blogger opinions are 75% Bullish on MSGE, compared to the sector average of 67%.
Conclusion
We, at TipRanks, are positive on Madison Square Garden Entertainment despite the company reporting mixed Q3 results, as we believe that its stock is positioned for long-term growth.
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