STUB (NYSE:STUB) Downgraded to Hold Rating by Wall Street Zen

Key Points

• Wall Street Zen downgraded STUB from “Buy” to “Hold,” while the broader analyst consensus is also “Hold,” with seven Hold, four Buy and two Sell ratings and an average price target of $10.73.
• STUB shares opened at $8.02, up 4.5%, but remain well below the 52-week high of $27.89. Bank of America cut its price target to $7.50 and maintained an “Underperform” rating, citing profitability and cost concerns.
• The company exceeded its latest quarterly EPS estimate and reported 12.2% year-over-year revenue growth, but it continues to post deeply negative margins. Insiders sold approximately $2.3 million of stock over the past 90 days, while additional concerns include regulatory, legal and World Cup ticketing-related risks.

STUB (NYSE:STUB - Get Free Report) was downgraded by Wall Street Zen from a "buy" rating to a "hold" rating in a note issued to investors on Saturday.

Several other research firms also recently commented on STUB. Bank of America reaffirmed an "underperform" rating and issued a $7.50 target price (down from $11.00) on shares of STUB in a research report on Thursday. Morgan Stanley boosted their price target on STUB from $8.75 to $10.00 and gave the company an "equal weight" rating in a research note on Wednesday, June 10th. Weiss Ratings raised STUB from a "sell (e+)" rating to a "sell (d-)" rating in a report on Tuesday, July 7th. UBS Group set a $7.50 price objective on STUB in a report on Thursday. Finally, Evercore set a $14.00 price objective on STUB in a research report on Thursday. Four analysts have rated the stock with a Buy rating, seven have given a Hold rating and two have given a Sell rating to the stock. Based on data from MarketBeat, the stock presently has an average rating of "Hold" and a consensus price target of $10.73.

STUB Stock Up 4.5%

Shares of STUB opened at $8.02 on Friday. The firm has a market cap of $3.01 billion and a P/E ratio of -1.40. The company has a debt-to-equity ratio of 0.96, a quick ratio of 1.10 and a current ratio of 1.10. STUB has a 52 week low of $5.74 and a 52 week high of $27.89. The firm's 50-day simple moving average is $10.35 and its 200 day simple moving average is $9.21.

STUB (NYSE:STUB - Get Free Report) last issued its quarterly earnings data on Wednesday, May 13th. The company reported $0.06 earnings per share (EPS) for the quarter, topping the consensus estimate of ($0.01) by $0.07. STUB had a negative net margin of 93.54% and a negative return on equity of 9.73%. The firm had revenue of $446.05 million during the quarter. The business's revenue was up 12.2% compared to the same quarter last year. On average, analysts forecast that STUB will post 0.48 earnings per share for the current year.

Insider Buying and Selling

In other news, insider Mark Streams sold 28,531 shares of STUB stock in a transaction that occurred on Monday, July 6th. The shares were sold at an average price of $13.02, for a total value of $371,473.62. Following the completion of the sale, the insider directly owned 1,561,122 shares in the company, valued at approximately $20,325,808.44. The trade was a 1.79% decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is accessible through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Nayaab Islam sold 54,801 shares of the business's stock in a transaction that occurred on Monday, July 6th. The shares were sold at an average price of $13.03, for a total value of $714,057.03. Following the completion of the sale, the insider owned 8,454,764 shares of the company's stock, valued at approximately $110,165,574.92. This trade represents a 0.64% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last 90 days, insiders have sold 179,467 shares of company stock worth $2,286,430. Company insiders own 30.97% of the company's stock.

Hedge Funds Weigh In On STUB

Hedge funds have recently added to or reduced their stakes in the stock. WestCap Management LLC bought a new stake in shares of STUB during the 4th quarter valued at $429,370,000. PointState Capital LP grew its holdings in shares of STUB by 19.9% during the 4th quarter. PointState Capital LP now owns 24,823,335 shares of the company's stock worth $335,860,000 after purchasing an additional 4,117,332 shares in the last quarter. Capital Research Global Investors bought a new position in shares of STUB in the fourth quarter worth $106,887,000. Index Venture Associates III Ltd bought a new position in shares of STUB in the fourth quarter worth $85,192,000. Finally, Capital International Investors acquired a new position in STUB in the fourth quarter valued at about $55,235,000.

STUB News Roundup

Here are the key news stories impacting STUB this week:

• Positive Sentiment: Second-quarter revenue reached approximately $573 million, above analysts’ $532 million estimate, while gross merchandise sales benefited from strong World Cup ticket demand. The sales performance suggests continued customer demand and operating scale potential. StubHub's Q2 Gross Merchandise Sales Beat Driven by World Cup, BofA Securities Says
• Positive Sentiment: Evercore ISI analyst Mark Mahaney maintained a Buy rating, citing StubHub’s asset-light model, execution potential and valuation after the selloff. Mark Mahaney Initiates StubHub With Buy Rating
• Neutral Sentiment: The earnings call and market commentary indicate that the World Cup created a major temporary sales boost, but investors remain uncertain whether StubHub can sustain growth and improve margins after the event. StubHub's World Cup boom masks tougher road ahead
• Negative Sentiment: StubHub reported roughly breakeven earnings per share, missing the $0.09 consensus estimate despite the revenue beat. Costs outpaced revenue growth, erasing the expected profit boom and raising concerns about persistent profitability problems. StubHub Stock Sinks After Ticket Reseller Fails to Post Profit
• Negative Sentiment: A World Cup ticketing partnership reportedly left some customers unable to access stadiums, triggering negative publicity, litigation and potential reputational damage. StubHub tanks as World Cup ticket fiasco wipes out profit boom
• Negative Sentiment: Bank of America reaffirmed its Underperform rating and reduced its price target to $7.50 from $11, citing profitability challenges, rising costs and regulatory uncertainty. StubHub's Post-IPO Hangover Deepens
• Negative Sentiment: Block & Leviton announced an investigation into potential securities-law violations, adding another source of legal uncertainty for shareholders. StubHub Securities Law Investigation

About STUB

Stubhub Holdings Inc, through its subsidiaries, provides an online marketplace to buy and sell tickets for sports, concerts, theater, festivals and other live events. Stubhub Holdings Inc is based in NEW YORK.

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