Live Nation Stock Tumbles As Company Reportedly Facing Antitrust Lawsuit

Shares in Ticketmaster parent Live Nation Entertainment (LYV) slid more than 8% in extended trading Monday evening after The Wall Street Journal reported that the U.S. Department of Justice is preparing to file an antitrust lawsuit against the company as soon as next month, potentially leading to significant changes to how concert promotions and ticketing are managed.

According to people familiar with the matter, the DOJ will allege that the ticket seller has used its dominance in the marketplace to undermine competition for ticketing live events, though the sources did not provide specific accusations made by the department, the Journal reported.

Since the DOJ conditionally approved the Live Nation and Ticketmaster merger in 2010, lawmakers have accused the ticketing giant of high prices, insufficient customer service, and anticompetitive tactics, prompting calls for the company to be broken up. In 2022, Live Nation faced considerable backlash after it bungled ticket sales for Taylor Swift’s "Eras" tour, with critics arguing the company’s practices were disadvantaging consumers.

Despite Ticketmaster controlling over 80% of the primary ticket market at the largest venues in the United States and having exclusive ticketing arrangements with stadiums that attract sought-after performers, the ticket seller maintains it doesn’t have a stranglehold of the ticketing space. “Ticketmaster has more competition today than it has ever had, and the deal terms with venues show it has nothing close to monopoly power,” a Ticketmaster spokeswoman told the Journal.

Last month, Live Nation’s corporate affairs head Dan Wall rejected the notion that the company engages in anticompetitive behavior, asserting that artists set ticketing prices, which are also subject to demand and supply factors.

After completing a triple bottom in late April last year, the Live Nation Entertainment share price has trended mostly higher apart from several pullbacks to the key moving averages. Amid Wednesday’s anticipated news-driven sell-off, 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-day moving average. A breakdown below this closely watched chart level could see the stock retest 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% over the past 12 months.

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As of the date this article was written, the author does not own any of the above securities.