B. Riley Initiates Neutral Rating on Lionsgate Studios
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 5 days ago
0mins
Source: seekingalpha
- Rating and Price Target: B. Riley Securities has initiated coverage of Lionsgate Studios (LION) with a Neutral rating and a price target of $17, which represents approximately an 11% upside from Tuesday's closing price of $15.31, indicating improved operating fundamentals but suggesting that the recent stock rally has left its valuation appearing full.
- Film Business Support: The Motion Picture segment is bolstered by strong box office performance from films like Michael and is anchored by franchises such as The Hunger Games, John Wick, and The Resurrection of the Christ, which are expected to drive a recovery in the theatrical market.
- Television Production Outlook: The Television Production segment is anticipated to rebound in fiscal 2027, driven by increased scripted episodic deliveries, stable library revenue, and easier year-over-year comparisons, which will further enhance revenue growth for the company.
- Financial Condition and Leverage: While B. Riley forecasts revenue and adjusted OIBDA growth for FY27, the company faces approximately $1.94 billion in long-term debt and a net leverage of 6.1 times, indicating that leverage will be a near-term constraint on its financial flexibility.
Trade with 70% Backtested Accuracy
Stop guessing "Should I Buy LION?" and start using high-conviction signals backed by rigorous historical data.
Sign up today to access powerful investing tools and make smarter, data-driven decisions.
Analyst Views on LION
Wall Street analysts forecast LION stock price to fall
5 Analyst Rating
4 Buy
1 Hold
0 Sell
Strong Buy
Current: 14.660
Low
8.00
Averages
9.30
High
11.00
Current: 14.660
Low
8.00
Averages
9.30
High
11.00
About LION
Lionsgate Studios Corp. is a pure play content company. The Company brings together diversified motion picture and television production and distribution businesses, a portfolio of brands and franchises, a talent management and production house and a more than 20,000-title film and television library. The Company's Motion Picture segment consists of the development and production of feature films, acquisition of North American and worldwide distribution rights, North American theatrical, home entertainment and television distribution of feature films produced and acquired, and worldwide licensing of distribution rights to feature films produced and acquired. Its Television Production segment consists of the development, production and worldwide distribution of television productions, including television series, television movies and miniseries, and non-fiction programming. Television Production segment also includes the operations of 3 Arts Entertainment, a talent management company.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
B. Riley Initiates Neutral Rating on Lionsgate Studios
- Rating and Price Target: B. Riley Securities has initiated coverage of Lionsgate Studios (LION) with a Neutral rating and a price target of $17, which represents approximately an 11% upside from Tuesday's closing price of $15.31, indicating improved operating fundamentals but suggesting that the recent stock rally has left its valuation appearing full.
- Film Business Support: The Motion Picture segment is bolstered by strong box office performance from films like Michael and is anchored by franchises such as The Hunger Games, John Wick, and The Resurrection of the Christ, which are expected to drive a recovery in the theatrical market.
- Television Production Outlook: The Television Production segment is anticipated to rebound in fiscal 2027, driven by increased scripted episodic deliveries, stable library revenue, and easier year-over-year comparisons, which will further enhance revenue growth for the company.
- Financial Condition and Leverage: While B. Riley forecasts revenue and adjusted OIBDA growth for FY27, the company faces approximately $1.94 billion in long-term debt and a net leverage of 6.1 times, indicating that leverage will be a near-term constraint on its financial flexibility.
See More
Summer Box Office Surges Towards $10 Billion Milestone
- Strong Box Office Performance: As of Sunday, the summer box office has reached $1.8 billion, down less than 2% from 2019, indicating a robust recovery in the industry, with projections suggesting an annual box office could exceed $10 billion for the first time.
- Market Rebound: The success of Disney's 'The Devil Wears Prada 2' and other low-budget horror films has driven box office growth, with four films contributing nearly $850 million since May, reflecting strong audience demand for new content.
- Sustained Sales Trend: While typical box office sales drop 50% to 70% after opening weekend, films like 'Obsession' have seen ticket sales increase by 39% and 14% in their second and third weekends, showcasing positive word-of-mouth and sustained audience interest.
- Optimistic Future Outlook: With major releases like 'Spider-Man: Brand New Day' on the horizon, the summer box office is projected to reach $4.2 billion, marking a significant recovery towards pre-pandemic levels and boosting confidence for the fall and holiday seasons.
See More
Heated Rivalry Sparks Surge in Female Viewership
- Female Viewership Surge: HBO Max's 'Heated Rivalry' attracted approximately two-thirds female viewers, highlighting the show's strong appeal among women and pushing LGBTQ+ media further into the mainstream.
- Social Media Buzz: Over 900,000 TikTok posts related to 'fujoshi' indicate a surge in female interest in male-male romance stories, enhancing the subculture's visibility in the U.S.
- Growing Market Demand: According to Nielsen, 61% of viewers for the 2023 political romcom 'Red, White & Royal Blue' were women, reflecting an increasing demand for such content, which may drive the production of more related works.
- Cultural Phenomenon: The success of 'Heated Rivalry' and similar works has significantly raised female readers' interest in male-male romance novels, marking the rise of this subculture and potentially influencing future creative directions in film and television.
See More
2026 Summer Box Office Shows Strong Recovery
- Box Office Recovery: The 2026 summer box office has reached $1.8 billion so far, down less than 2% from 2019, indicating signs of industry recovery, with projections suggesting a total of $4.2 billion for the season, marking a strong rebound post-pandemic.
- Hit Films Driving Growth: Major releases like 'Michael,' 'Obsession,' 'Toy Story 5,' and 'The Odyssey' have collectively contributed nearly $850 million since early May, reflecting heightened audience enthusiasm and driving overall box office growth.
- Audience Word-of-Mouth Impact: 'Obsession' has seen ticket sales increase by 39% and 14% in its second and third weekends, respectively, demonstrating strong word-of-mouth that is attracting more moviegoers to theaters and further boosting box office figures.
- Optimistic Future Outlook: With 'Spider-Man: Brand New Day' set to release soon, analysts predict an opening weekend of $200 million to $250 million, which will lay a solid foundation for August's box office growth, leading to an optimistic outlook for the second half of the year.
See More
Netflix's Low Valuation Masks Strong Growth Potential
- Valuation Compression: Netflix's market valuation hit a 52-week low on June 22, 2023, falling 22.3% year-to-date and 45.6% from its 52-week high, indicating market concerns about its growth prospects; however, its forward P/E ratio of 20.2 remains attractive compared to the S&P 500's 22.4.
- Content Strategy: Despite being outbid by Paramount Skydance for Warner Bros. Discovery and collecting a $2.8 billion breakup fee, Netflix's ongoing expansion into film, sports, podcasts, and gaming underscores its commitment to enhancing entertainment value for subscribers through diverse content offerings.
- International Market Growth: In Q1 2026, Netflix's Asia-Pacific revenue surpassed Latin America for the second consecutive quarter, indicating the success of its international strategy, with U.S. and Canada revenue now accounting for less than 30% of total revenue, reflecting a growing reliance on global markets.
- Investment Value: While Netflix faces risks from price hikes and subscriber churn, its full-year 2026 revenue guidance of $50.7 billion to $51.7 billion, representing a 12% to 14% year-over-year increase, highlights its long-term investment potential, particularly for investors focused on future growth prospects.
See More
Netflix Hits 52-Week Low Amid Mixed Reviews on Acquisition Attempts
- Stock Price Decline: Netflix's stock hit a 52-week low on June 22, falling 22.3% year-to-date and 45.6% from its 52-week high, indicating market concerns about its future growth and potentially impacting investor confidence.
- Acquisition Attempts Struggled: Despite Netflix's efforts to acquire Warner Bros. Discovery and Roku, it was outbid by competitors, reflecting pressure on its content acquisition strategy and suggesting cracks in its content pipeline.
- Optimistic Revenue Guidance: Netflix's first-quarter 2026 guidance projects revenue between $50.7 billion and $51.7 billion, a year-over-year increase of 12% to 14%, but relies on the assumption of doubling ad revenue, which may be challenging in a worsening economic environment.
- International Market Growth: Netflix's Asia-Pacific revenue has surpassed Latin America's for two consecutive quarters, demonstrating the success of its international strategy and reducing reliance on the North American market, thereby enhancing its competitiveness globally.
See More
B. Riley Initiates Neutral Rating on Lionsgate Studios
- Rating and Price Target: B. Riley Securities has initiated coverage of Lionsgate Studios (LION) with a Neutral rating and a price target of $17, which represents approximately an 11% upside from Tuesday's closing price of $15.31, indicating improved operating fundamentals but suggesting that the recent stock rally has left its valuation appearing full.
- Film Business Support: The Motion Picture segment is bolstered by strong box office performance from films like Michael and is anchored by franchises such as The Hunger Games, John Wick, and The Resurrection of the Christ, which are expected to drive a recovery in the theatrical market.
- Television Production Outlook: The Television Production segment is anticipated to rebound in fiscal 2027, driven by increased scripted episodic deliveries, stable library revenue, and easier year-over-year comparisons, which will further enhance revenue growth for the company.
- Financial Condition and Leverage: While B. Riley forecasts revenue and adjusted OIBDA growth for FY27, the company faces approximately $1.94 billion in long-term debt and a net leverage of 6.1 times, indicating that leverage will be a near-term constraint on its financial flexibility.
See More
Summer Box Office Surges Towards $10 Billion Milestone
- Strong Box Office Performance: As of Sunday, the summer box office has reached $1.8 billion, down less than 2% from 2019, indicating a robust recovery in the industry, with projections suggesting an annual box office could exceed $10 billion for the first time.
- Market Rebound: The success of Disney's 'The Devil Wears Prada 2' and other low-budget horror films has driven box office growth, with four films contributing nearly $850 million since May, reflecting strong audience demand for new content.
- Sustained Sales Trend: While typical box office sales drop 50% to 70% after opening weekend, films like 'Obsession' have seen ticket sales increase by 39% and 14% in their second and third weekends, showcasing positive word-of-mouth and sustained audience interest.
- Optimistic Future Outlook: With major releases like 'Spider-Man: Brand New Day' on the horizon, the summer box office is projected to reach $4.2 billion, marking a significant recovery towards pre-pandemic levels and boosting confidence for the fall and holiday seasons.
See More
Heated Rivalry Sparks Surge in Female Viewership
- Female Viewership Surge: HBO Max's 'Heated Rivalry' attracted approximately two-thirds female viewers, highlighting the show's strong appeal among women and pushing LGBTQ+ media further into the mainstream.
- Social Media Buzz: Over 900,000 TikTok posts related to 'fujoshi' indicate a surge in female interest in male-male romance stories, enhancing the subculture's visibility in the U.S.
- Growing Market Demand: According to Nielsen, 61% of viewers for the 2023 political romcom 'Red, White & Royal Blue' were women, reflecting an increasing demand for such content, which may drive the production of more related works.
- Cultural Phenomenon: The success of 'Heated Rivalry' and similar works has significantly raised female readers' interest in male-male romance novels, marking the rise of this subculture and potentially influencing future creative directions in film and television.
See More
2026 Summer Box Office Shows Strong Recovery
- Box Office Recovery: The 2026 summer box office has reached $1.8 billion so far, down less than 2% from 2019, indicating signs of industry recovery, with projections suggesting a total of $4.2 billion for the season, marking a strong rebound post-pandemic.
- Hit Films Driving Growth: Major releases like 'Michael,' 'Obsession,' 'Toy Story 5,' and 'The Odyssey' have collectively contributed nearly $850 million since early May, reflecting heightened audience enthusiasm and driving overall box office growth.
- Audience Word-of-Mouth Impact: 'Obsession' has seen ticket sales increase by 39% and 14% in its second and third weekends, respectively, demonstrating strong word-of-mouth that is attracting more moviegoers to theaters and further boosting box office figures.
- Optimistic Future Outlook: With 'Spider-Man: Brand New Day' set to release soon, analysts predict an opening weekend of $200 million to $250 million, which will lay a solid foundation for August's box office growth, leading to an optimistic outlook for the second half of the year.
See More
Netflix's Low Valuation Masks Strong Growth Potential
- Valuation Compression: Netflix's market valuation hit a 52-week low on June 22, 2023, falling 22.3% year-to-date and 45.6% from its 52-week high, indicating market concerns about its growth prospects; however, its forward P/E ratio of 20.2 remains attractive compared to the S&P 500's 22.4.
- Content Strategy: Despite being outbid by Paramount Skydance for Warner Bros. Discovery and collecting a $2.8 billion breakup fee, Netflix's ongoing expansion into film, sports, podcasts, and gaming underscores its commitment to enhancing entertainment value for subscribers through diverse content offerings.
- International Market Growth: In Q1 2026, Netflix's Asia-Pacific revenue surpassed Latin America for the second consecutive quarter, indicating the success of its international strategy, with U.S. and Canada revenue now accounting for less than 30% of total revenue, reflecting a growing reliance on global markets.
- Investment Value: While Netflix faces risks from price hikes and subscriber churn, its full-year 2026 revenue guidance of $50.7 billion to $51.7 billion, representing a 12% to 14% year-over-year increase, highlights its long-term investment potential, particularly for investors focused on future growth prospects.
See More
Netflix Hits 52-Week Low Amid Mixed Reviews on Acquisition Attempts
- Stock Price Decline: Netflix's stock hit a 52-week low on June 22, falling 22.3% year-to-date and 45.6% from its 52-week high, indicating market concerns about its future growth and potentially impacting investor confidence.
- Acquisition Attempts Struggled: Despite Netflix's efforts to acquire Warner Bros. Discovery and Roku, it was outbid by competitors, reflecting pressure on its content acquisition strategy and suggesting cracks in its content pipeline.
- Optimistic Revenue Guidance: Netflix's first-quarter 2026 guidance projects revenue between $50.7 billion and $51.7 billion, a year-over-year increase of 12% to 14%, but relies on the assumption of doubling ad revenue, which may be challenging in a worsening economic environment.
- International Market Growth: Netflix's Asia-Pacific revenue has surpassed Latin America's for two consecutive quarters, demonstrating the success of its international strategy and reducing reliance on the North American market, thereby enhancing its competitiveness globally.
See More
