October 23, 2023
For several years, concert lovers were forced by the pandemic to stay home. But since the pandemic eased, more people than ever are attending live events. Led by massive music stars like Taylor Swift and Beyonce, the concert and entertainment industry has roared back after a few lean years.
As a retail shareholder, you might wonder how to invest in this entertainment phenomenon. There are a few options for investing in entertainment companies and venues. They include Live Nation Entertainment (Tii:LYV), Madison Square Garden Sports (Tii:MSGS) and Eventbrite (Tii:EB). More on each of them later. We will also introduce you to Sphere Entertainment (Tii:SPHR), the company behind the massive sphere concert venue that recently opened in Las Vegas.
But first, let’s examine the state of entertainment, post-COVID.
Live entertainment was decimated by the pandemic. According to the Motion Picture Association, the global theatrical and home/mobile entertainment market totaled $80.8 billion in 2020, a drop of 18% from the year before and the lowest level since 2016.
In 2019, the US box office grossed $11.4 billion. In 2020, due to the pandemic, the box office gross plummeted to $2.2 billion, an 81% decline from the previous year, according to a University of Michigan study. The number of movie theaters in the U.S. has been declining steadily for years as well. In 2019, there were approximately 5,500 movie theater locations in the U.S., down from nearly 7,000 in 2005. This steady decline has recently accelerated, according to CNBC, which reported that as of February 2023, “since 2019, the number of total screens in the U.S. have decreased by around 3,000.”
That does not mean entertainment is dead. Far from it. In fact, entertainment has exploded post-pandemic as concertgoers have flooded into venues throughout the summer. Even movie theaters are rebounding. Box office ticket sales are up nearly 50% compared to last year and down just 25% from 2019, according to data from Comscore, though some of the improvement can be attributed to more movies being released.
Consumers have also changed the way they consume entertainment since the pandemic. As the world quarantined, many turned to streaming services. Companies like Disney (Tii:DIS), Netflix (Tii:NFLX), and Apple (Tii:AAPL) have grown throughout the pandemic and their popularity seems to be holding even as the world fully reopens. Digital media accounted for over three-quarters of total theatrical, home/mobile entertainment revenue. There are now 1.1 billion online video subscribers worldwide up 26% from 2019.
The live concert industry is bouncing back strongly, buoyed by massive concert tours this summer by Taylor Swift and Beyonce. Beyonce’s “Renaissance Tour” grossed $579.8 million from nearly 2.8 million tickets sold for 56 shows, according to Live Nation. Swift’s “The Eras Tour” and concert film are expected to rake in nearly $5 billion, which according to Peter Cohan of Babson College, surpasses the economic output of 42 countries.
Back to the entertainment company stocks that individual investors might consider:
Live Nation Entertainment is an entertainment company that produces live music concerts. It provides several services, including promotion of live music events, ticket selling, and advertising and sponsorship. The company provides ticketing through websites, mobile apps, numerous retail outlets and call centers. It also owns, operates, and holds equity interest in booking venues including House of Blues music venues and locations such as The Fillmore in San Francisco, the Hollywood Palladium, Brooklyn Bowl, the Ziggo Dome in Amsterdam and 3Arena in Ireland. Live Nation is headquartered in Beverly Hills, Calif.
Madison Square Garden Sports is a professional sports company, with a collection of assets that includes the New York Knicks (NBA) and the New York Rangers (NHL), as well as two development league teams – the Westchester Knicks (NBAGL) and the Hartford Wolf Pack (AHL). MSG Sports also operates a professional sports team performance center – the MSG Training Center in Greenburgh, NY.
Sphere Entertainment is led by James Dolan, who owns a large share of Madison Square Garden Sports, though it is a stand-alone publicly traded company. The Sphere venue on the Las Vegas skyline cost more than $2 billion to build. There are plans to build other spheres in major cities around the world to be used for music, film and sporting events. Rock band U2 headlined the initial concert at the Las Vegas Sphere.
Eventbrite is a self-service ticketing and experience technology platform that serves event creators. It is a platform to enable creators to solve the challenges associated with creating live experiences. The company's platform integrates components needed to plan, promote and produce live events.
Whether they are interested in concerts, sports or movies, there are several options for retail shareholders looking to back publicly traded entertainment companies. And it appears as if the industry is emerging from the COVID slump. Somebody grab the popcorn.
TiiCKER was created for fan-first, brand-first public companies—with exclusive perks served-up weekly to shareholders. Own stock? Connect your brokerage account to view more than 130 perks waiting for you right now!