Goldman Sachs analysts believe StubHub Holdings Inc (NYSE: STUB) is “positively levered” to the large and growing ticketing market.
In a note to clients, they initiated coverage of the global online ticket platform with a ‘Buy’ rating and a 12-month target price of $46 per share.
The analysts believe StubHub will be able to take additional secondary ticketing market share, both in North America and internationally, while also scaling into the $132 billion direct issuance market opportunity and growing its advertising revenue contribution in the years ahead.
They forecast StubHub’s total revenue growing at a compound annual growth rate (CAGR) of 36% plus between 2024 and 2029, driven by gross merchandise sales growth and advertising revenue.
The Goldman analysts also see StubHub as being able to generate “levered” equity returns for its shareholders, given the company’s asset-light model, and 50% plus incremental margins coupled with its ability to convert free cash flow at 100% plus.
StubHub shares fell 5% to $18.59 in midday trading on Tuesday.