NEW YORK (TheStreet) -- Live Nation Entertainment (LYV) shares are down 1.06% to $22.50 in heavy trading volume this morning after the company last night announced that it priced offerings of $250 million aggregate principal amount of its 2.50% convertible senior notes due 2019 and $250 million aggregate principal amount of its 5.375% senior notes due 2022.
The Convertible Notes and the Senior Notes were each priced at 100% of their principal amount, plus accrued interest, if any, from May 23, 2014.
The company intends to use the net proceeds from these offerings to redeem, in the near future, all of its outstanding 2.875% Convertible Senior Notes due 2027, to pay related fees and expenses, to reinvest in the company's core business and for general corporate purposes, including potential acquisitions.
TheStreet Ratings team rates LIVE NATION ENTERTAINMENT as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:
"We rate LIVE NATION ENTERTAINMENT (LYV) a HOLD. The primary factors that have impacted our rating are mixed some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance and impressive record of earnings per share growth. However, as a counter to these strengths, we find that the company's profit margins have been poor overall."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- LYV's revenue growth has slightly outpaced the industry average of 14.9%. Since the same quarter one year prior, revenues rose by 22.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Powered by its strong earnings growth of 51.51% and other important driving factors, this stock has surged by 60.83% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
- Even though the current debt-to-equity ratio is 1.30, it is still below the industry average, suggesting that this level of debt is acceptable within the Media industry. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 0.75 is weak.
- 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, LIVE NATION ENTERTAINMENT's return on equity significantly trails that of both the industry average and the S&P 500.
- The gross profit margin for LIVE NATION ENTERTAINMENT is currently lower than what is desirable, coming in at 33.60%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -2.87% is significantly below that of the industry average.
- You can view the full analysis from the report here: LYV Ratings Report