Key takeaways
- Live Nation Entertainment shares fell in extended trading on Monday after The Wall Street Journal reported that the DOJ is preparing to file an antitrust lawsuit against the company.
- The Justice Department will allege that the ticket seller has used its dominance in the market to undermine competition for ticket sales to live events, sources told Diary.
- Live Nation Entertainment stock price may find a confluence of support around $91 from a 12-month uptrend line and the 200-day moving average.
Shares of Ticketmaster parent Live Nation Entertainment (LYV) fell more than 8% in extended trading Monday night after The Wall Street Journal reported that the US Department of Justice is preparing to file an antitrust lawsuit against the company next month, which could lead to significant changes in the way concert promotions and ticket sales are handled.
According to people familiar with the matter, the DOJ will allege that the ticket seller has used its dominance in the market to undermine competition for ticket sales to live events, although the sources did not provide specific accusations made by the department, the Diary reported.
Since the Justice Department conditionally approved the merger of Live Nation and Ticketmaster in 2010, lawmakers have accused the ticket giant of high prices, poor customer service and anti-competitive tactics, prompting calls for the company to be dissolved. . In 2022, Live Nation faced considerable backlash after it botched ticket sales for Taylor Swift's “Eras” tour, with critics arguing that the company's practices were disadvantageous to consumers.
Although Ticketmaster controls more than 80% of the primary ticket market at the largest venues in the United States and has exclusive ticketing agreements with stadiums that attract sought-after artists, the ticket seller maintains that it has no dominance absolute over the ticket sales space. “Ticketmaster has more competition today than ever before, and the terms of the deal with venues show that it has nothing resembling monopoly power,” a Ticketmaster spokeswoman told The Associated Press. Diary.
Last month, Live Nation's head of corporate affairs, Dan Wall, rejected the idea that the company engages in anti-competitive behavior, saying that artists set ticket prices, which are also subject to supply and demand factors. .
After completing a triple bottom in late April of last year, Live Nation Entertainment's stock price has trended mostly higher, aside from several pullbacks to key moving averages. Amid Wednesday's news-driven early selloff, investors should closely monitor the $91 level, an area where the price finds a confluence of support from a 12-month uptrend line and the 200 moving average. days. A break below this level on the closely watched chart could see the stock retest the lower support around $81.75.
Live Nation shares fell 8.3% to $91.50 in after-hours trading Monday. The stock is up about 45% in the last 12 months.
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