NEW YORK (TheStreet) -- Lionsgate Entertainment (LGF) reported record quarterly revenue and record adjusted EBIDTA when the company released its third-quarter results after the market closed on Thursday.
Lionsgate noted revenue of $839.9 million, a 13% increase from $743.6 million in the same period one year earlier, and adjusted EBIDTA of $151.4 million, up from $87.2 million in the same quarter a year ago. The company cited the domestic and international success of The Hunger Games: Catching Fire movie for the increases, along with the domestic performances of Ender's Game and A Madea Christmas and the international performances of Red 2, Escape Plan and Now You See Me.
The company also posted net income of $88.8 million, or 64 cents a share, and adjusted net income of $96.4 million, or 70 cents a share for the quarter that ended on Dec. 31. Finally, Lionsgate had free cash flow of $117.4 million for the quarter.
Analysts expected Lionsgate to earn 44 cents a share on revenue of $834 million, according to Thomson Reuters."Our stellar results in the quarter were attributable to our operating performance, the favorable environment for content and the benefits from our strong balance sheet," said CEO Jon Feltheimer in the company's statement. "We will continue to invest in content and embrace innovative models for licensing that content to digital and traditional platforms alike in order to build on this performance and create additional long-term value for our shareholders." The stock was up 3.42% to $31.73, up $1.05 from its previous close of $30.68, at the close of the trading day on Thursday. It was down 0.66% to $31.69 in after-hours trading. TheStreet Ratings team rates LIONS GATE ENTERTAINMENT CP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation: "We rate LIONS GATE ENTERTAINMENT CP (LGF) a BUY. This is driven by several positive factors, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its notable return on equity, good cash flow from operations, solid stock price performance and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income." Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Media industry and the overall market, LIONS GATE ENTERTAINMENT CP's return on equity significantly exceeds that of both the industry average and the S&P 500.
- Net operating cash flow has significantly increased by 1675.00% to $139.86 million when compared to the same quarter last year. In addition, LIONS GATE ENTERTAINMENT CP has also vastly surpassed the industry average cash flow growth rate of -6.65%.
- Compared to its closing price of one year ago, LGF's share price has jumped by 77.82%, exceeding the performance of the broader market during that same time frame. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.
- 47.51% is the gross profit margin for LIONS GATE ENTERTAINMENT CP which we consider to be strong. Regardless of LGF's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 0.10% trails the industry average.
- LIONS GATE ENTERTAINMENT CP has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has not demonstrated a clear trend in earnings over the past 2 years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, LIONS GATE ENTERTAINMENT CP turned its bottom line around by earning $1.57 versus -$0.30 in the prior year.
- You can view the full analysis from the report here: LGF Ratings Report
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV