Live Nation Flywheel Ramping Toward Full Speed; Rebound Limited to U.S. and U.K. for Now

Live Nation’s quarterly results rallied strongly versus last year as management’s focus on a “return to scale” over the summer worked to perfection. Both levels of demand for and supply of live music continue to expand despite limited activity for the firm in Europe and other international markets. The rebound was heavily levered to the U.S. and the U.K. which accounted for 95% of attendees and 90% of fee-bearing tickets versus 75% and 80%, respectively, in the third quarter of 2019. While we remain concerned about the lingering threat of new lockdown restrictions due to the spread of the Delta variant, the firm appears to be on track to a recovery to pre-pandemic levels. We are maintaining our narrow moat and plan to raise our $78 fair value estimate to account for the increasing strength of the pipeline and higher audience willingness to return than we expected.