Eventbrite Slides on Weak Forecast and RBC Downgrade

Eventbrite also says it's beginning to see negative effects from the coronavirus outbreak.
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Share prices of Eventbrite  (EB) - Get Report plunged Friday after the event management company released weaker-than-expected earnings projections for the first quarter and RBC Capital Markets downgraded the stock.

The company also said it was beginning to see negative effects from the coronavirus outbreak.

Eventbrite forecast revenue of $84 million to $88 million for the first quarter, below analysts’ estimates of $90.2 million. For all of 2020, the company projected revenue of $342 million to $359 million, lagging behind analysts’ predictions of $365.3 million.

The company anticipates adjusted Ebitda of negative $3 million to positive $1 million for the first quarter, and a loss of $4 million to breakeven for the full year. Both those ranges trail analysts’ forecasts, according to Barron’s.

RBC Capital Markets cut its rating on Eventbrite to sector perform from outperform and lowered its share-price target to $17 from $23. The securities firm said in a report that it won’t turn positive until the company creates a “clear path” to 15% to 20% sales growth.

To be sure, the company reported better-than-expected earnings for the fourth quarter. Eventbrite announced it lost $13.9 million, or 16 cents a share, in the quarter, narrowing from a loss of $13 million, or 17 cents a share, a year earlier.

Sales rose 9% to $82.7 million. Analysts expected a loss of 21 cents a share and revenue of $78.8 million, according to FactSet.

As for the coronavirus, "we have seen early evidence of event cancellations that appear to be associated with the coronavirus, and we expect the outbreak will impact live events and attendance in the near term,” Eventbrite said in a letter to shareholders.

At last check, Eventbrite traded at $14.15, down 16.86%.