StubHub Stock Sinks. No Guidance and a Downgrade Are to Blame.

StubHub went public on Sept. 17. (Gabby Jones/Bloomberg)

Key Points

• StubHub Holdings stock fell 23% to $14.51 on Friday, down 38% from its initial public offering price of $23.50.
• The company reported a third-quarter loss of $4.27 per share, missing estimates, but revenue of $468.1 million exceeded expectations.
• BofA Securities downgraded StubHub to Neutral from Buy and cut its price target to $19 due to delayed guidance and near-term uncertainty.

StubHub Holdings stock was falling hard on Friday as investors digested a delay in guidance and a downgrade at BofA Securities.

StubHub went public on Sept. 17, and reported its first financial results since then after the stock market closed on Thursday. The ticket reseller reported a loss of $4.27 a share, which missed Wall Street estimates of a loss of $2.87 a share, according to FactSet. Revenue of $468.1 million beat analyst expectations of $451.8 million.

Gross merchandise sales—or GMS—is a closely monitored figure at StubHub and represents the total dollar valued paid by buyers for ticket transactions. Third-quarter GMS of $2.43 billion came in above analyst estimates of $2.36 billion.

“Our debut quarter as a public company underscores the strength and resilience of our global marketplace,” CEO Eric Baker said in the earnings release.

Shares were tumbling 24% to $14.25 on Friday. The stock is now down 39% from its IPO price of $23.50.

Barron’s reporter Andrew Bary wrote in September that he thought investors should be cautious when it came to StubHub.

Besides earnings, Wall Street was mostly concerned with the lack of visibility into the next few months after Baker said on the conference call that the company wouldn’t be providing guidance until early 2026.

“We were looking for increasing visibility on growth drivers, and we were left with more near-term uncertainty,” BofA Securities analyst Justin Post wrote in a note on Friday. “While StubHub intends to provide annual 2026 guidance on its 4Q earnings call, we expect the 2026 estimate overhang to continue.”

Post downgraded shares of StubHub to Neutral from Buy and cut his price target to $19 from $25.

Another concern company’s ability to continue growing earnings after a surge in live events in 2024.

“We are lapping the unprecedented Taylor Swift Eras Tour,” CFO Constance James said on the earnings call. She added that several large tours that would normally go on sale in the fourth quarter actually occurred earlier, in late September. Still, management noted that there continues to be strong demand for live events.

Wedbush analyst Scott Devitt cut his price target on StubHub to $22 from $25 while maintaining an Outperform rating on the stock.

“In our view, it may take multiple quarters for investors to regain comfort without greater transparency from the company or tangible evidence of an inflection in the business,” he wrote on Friday.

Some analysts remain even more optimistic though. Goldman Sachs analyst Eric Sheridan rates the stock as a Buy with a $45 price target.

“Longer-term, we continue to frame STUB as being positively levered to the large and growing ticketing market—which will continue to scale as consumers prioritize experiences over products,” he wrote.

Write to Angela Palumbo at angela.palumbo@dowjones.com