Please ensure Javascript is enabled for purposes of website accessibility

Here's Why Eventbrite Is Plunging Today

By Matthew Frankel, CFP® - May 2, 2019 at 12:07PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The event-ticketing company's stock is down 30% after disappointing results

What happened

Event-ticketing company Eventbrite (EB -4.11%) reported its first-quarter results on Wednesday afternoon, and to say that investors are disappointed would be a massive understatement. As of 11:20 a.m. EDT on Thursday, the stock was down by about 30%. This comes after already-dismal performance so far in 2019.

So what

Plunges like this generally indicate more than a simple earnings miss, and that's certainly the case here.

Crowd of people watching a concert.

Image source: Getty Images.

For starters, Eventbrite did miss EPS expectations, reporting a loss of $0.13 per share, significantly worse than the $0.08 per-share loss analysts had been looking for, and much worse than the break-even quarter the company posted in the first quarter of 2018.

The company missed on the top line as well. Although Eventbrite's $81.3 million in revenue represented 9.1% year-over-year growth, it fell nearly $2 million short of analysts' expectations.

As if this weren't bad enough, Eventbrite's guidance was pretty dismal. For the second quarter, the company expects $74-$78 million in revenue, while analysts had been looking for $82 million. That's a big disappointment.

Now what

To be sure, Eventbrite's first quarter wasn't completely terrible. Ticket sales on the company website grew by 15% year over year to 27 million.

Going forward, if Eventbrite can continue to grow at a double-digit rate and make that growth translate to profits, the stock could be cheap at the current levels. However, based on the numbers the company just reported, a 30% drop doesn't seem like an overreaction.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Eventbrite Stock Quote
Eventbrite
EB
$11.91 (-4.11%) $0.51

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
332%
 
S&P 500 Returns
118%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/26/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.