Sphere Entertainment (NYSE:SPHR) Shares Gap Up on Strong Earnings

Key Points

• Sphere Entertainment's shares surged from a previous close of $40.29 to an opening price of $45.00 after reporting an earnings per share (EPS) of $3.39, significantly beating analysts' estimates.
• Despite a positive earnings surprise, the company reported a negative return on equity of 16.78% and a net margin of -33.00%, with a quarterly revenue increase of 3.4% compared to last year.
• Wall Street analysts have mixed views on Sphere Entertainment, with a consensus rating of "Hold" and price targets ranging from $35.00 to $74.00, reflecting varied confidence among investors.

Sphere Entertainment Co. (NYSE:SPHR - Get Free Report)'s share price gapped up prior to trading on Monday following a stronger than expected earnings report. The stock had previously closed at $40.29, but opened at $45.00. Sphere Entertainment shares last traded at $39.95, with a volume of 455,056 shares.

The company reported $3.39 earnings per share (EPS) for the quarter, topping the consensus estimate of ($1.57) by $4.96. Sphere Entertainment had a negative return on equity of 19.27% and a negative net margin of 14.68%. The firm had revenue of $282.68 million during the quarter, compared to the consensus estimate of $280.23 million. During the same period in the previous year, the firm posted ($2.00) EPS. The company's quarterly revenue was up 3.4% compared to the same quarter last year.

Wall Street Analysts Forecast Growth

Several analysts have recently issued reports on the stock. Benchmark reissued a "sell" rating and set a $35.00 price objective on shares of Sphere Entertainment in a research note on Monday, May 19th. Morgan Stanley boosted their price objective on shares of Sphere Entertainment from $35.00 to $40.00 and gave the company an "equal weight" rating in a research note on Tuesday. Guggenheim boosted their price objective on shares of Sphere Entertainment from $69.00 to $74.00 and gave the company a "buy" rating in a research note on Friday, May 9th. The Goldman Sachs Group set a $36.00 price target on shares of Sphere Entertainment and gave the stock a "buy" rating in a research report on Friday, April 18th. Finally, Craig Hallum began coverage on Sphere Entertainment in a report on Monday, June 23rd. They issued a "buy" rating and a $75.00 price target for the company. One equities research analyst has rated the stock with a sell rating, four have issued a hold rating and six have given a buy rating to the company's stock. According to MarketBeat, the company currently has a consensus rating of "Hold" and a consensus target price of $49.50.

Institutional Trading of Sphere Entertainment

Large investors have recently added to or reduced their stakes in the business. LPL Financial LLC boosted its stake in Sphere Entertainment by 24.6% in the 4th quarter. LPL Financial LLC now owns 26,016 shares of the company's stock worth $1,049,000 after purchasing an additional 5,135 shares during the period. Geode Capital Management LLC boosted its stake in Sphere Entertainment by 0.7% in the 4th quarter. Geode Capital Management LLC now owns 617,437 shares of the company's stock worth $24,901,000 after purchasing an additional 4,429 shares during the period. Cerity Partners LLC boosted its stake in Sphere Entertainment by 60.0% in the 4th quarter. Cerity Partners LLC now owns 8,165 shares of the company's stock worth $329,000 after purchasing an additional 3,062 shares during the period. Invesco Ltd. boosted its stake in Sphere Entertainment by 2.2% in the 4th quarter. Invesco Ltd. now owns 38,615 shares of the company's stock worth $1,557,000 after purchasing an additional 830 shares during the period. Finally, Legal & General Group Plc boosted its stake in Sphere Entertainment by 2.8% in the 4th quarter. Legal & General Group Plc now owns 26,678 shares of the company's stock worth $1,076,000 after purchasing an additional 720 shares during the period. 92.03% of the stock is currently owned by institutional investors.

Sphere Entertainment Stock Down 1.1%

The business's 50 day moving average is $41.68 and its 200 day moving average is $37.81. The company has a debt-to-equity ratio of 0.36, a quick ratio of 0.53 and a current ratio of 1.13. The stock has a market cap of $1.41 billion, a price-to-earnings ratio of -7.40 and a beta of 1.71.

About Sphere Entertainment

Sphere Entertainment Co engages in the entertainment business. It produces, presents, or hosts various live entertainment events, including concerts, family shows, and special events, as well as sporting events, such as professional boxing, college basketball and hockey, professional bull riding, mixed martial arts, and esports and wrestling in its venues, including The Garden, Hulu Theater, Radio City Music Hall, and the Beacon Theatre in New York City; and The Chicago Theatre.