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Why Eventbrite Stock Gained 30% in April, but Already Gave It Up

By Jeremy Bowman – May 3, 2019 at 2:27PM

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Shares of the event-ticketing company gained in anticipation of its earnings report, but then crumbled when the news came out.

What happened

Shares of Eventbrite (EB -1.82%) surged last month as the stock recovered from a disappointing fourth-quarter earnings report, and enthusiasm built for the long-term opportunities for the event-ticketing specialist.

According to data from S&P Global Market Intelligence, the stock gained 30% through April -- but lost all of those gains after its first-quarter earnings report came out on May 1:

EB Chart

EB data by YCharts.

So what

There was little news out on Eventbrite in April. The stock rose early in the month coming off lows at the end of March, and then at the end of April in anticipation of the first-quarter earnings report.

Eventbrite shares have been volatile since last September. Investors have had hopes for the LiveNation Entertainment competitor -- the stock soared 59% on its initial trading day. But it's tumbled on two consecutive quarterly reports, and is now trading near its all-time low.

People holding their hands in the air at a concert

Image source: Getty Images.

In the first-quarter earnings report, Eventbrite's revenue and profits missed estimates; the company continued to struggle to integrate Ticketfly, which it acquired in 2017 from Pandora (now part of Sirius XM Radio) for $200 million. Revenue in the quarter grew 9.1% to $81.3 million, which missed estimates of $83.3 million. The company reported a loss per share of $0.13, worse than expectations of $0.08.

CEO Julia Hartz said challenges integrating Ticketfly caused the company to spend resources on that, rather than growing the rest of the business.

Now what

Eventbrite's guidance didn't make investors feel any better. The company sees second-quarter revenue of $74 million to $78 million, compared to estimates of $82 million. While fundamentals like paid tickets sold and the self sign-on channel are moving in the right direction, it looks like it will take at least a few quarters for the company to move past the Ticketfly issues.

The long-term opportunity for Eventbrite is still there, but investors will need some convincing after the latest results.

Jeremy Bowman has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Live Nation Entertainment and Sirius XM Radio. The Motley Fool has a disclosure policy.

Stocks Mentioned

Eventbrite, Inc. Stock Quote
Eventbrite, Inc.
$6.46 (-1.82%) $0.12

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