<\/p>\n
StubHub Holdings entered the second half of 2026 with one of the strongest quarters in its history, powered by record demand surrounding the FIFA World Cup.<\/p>\n
Gross merchandise sales jumped 34% year over year to a record $3.1 billion, while revenue climbed 33% to $573.1 million, according to the company’s second-quarter earnings release.<\/p>\n
StubHub (STUB) also reported adjusted EBITDA of $105.7 million, up 94% from a year earlier, as the ticket marketplace benefited from a wave of demand tied to the tournament.<\/p>\n
Despite those numbers, Bank of America analyst Justin Post came away from the quarter with a more cautious view of what happens once the World Cup catalyst fades.<\/p>\n
In a note given to TheStreet, Post downgraded StubHub to Underperform from Neutral and cut his price objective to $7.50 from $11.<\/p>\n
The analyst believes the strength of the second quarter could be masking a much slower growth setup for the remainder of 2026 and into next year.<\/p>\n
StubHub’s World Cup boom sets a high bar<\/p>\n
StubHub’s record quarter also produced a sharp improvement in cash generation.<\/p>\n
The company generated $321.9 million in operating cash flow and $309.7 million in free cash flow during the quarter, according to its SEC filing. Net leverage fell to 3.0 times trailing 12-month adjusted EBITDA from 4.5 times at the end of 2025.<\/p>\n
Management raised its full-year GMS outlook to between $10.1 billion and $10.3 billion, up from its previous forecast of $9.9 billion to $10.1 billion.<\/p>\n
However, StubHub left its adjusted EBITDA guidance unchanged at $400 million to $420 million.<\/p>\n
BofA estimated that second-quarter GMS came in roughly $500 million above Wall Street expectations, while StubHub increased its full-year GMS guidance by only about $200 million.<\/p>\n
Post said the high end of the new outlook implies second-half GMS growth of roughly 4%.<\/p>\n
The analyst now expects third-quarter GMS of about $2.46 billion, representing growth of just 1% year over year, before growth improves to around 7% in the fourth quarter.<\/p>\n
BofA sees a risk that World Cup demand pulled ticket purchases forward or temporarily changed StubHub’s market-share dynamics during the quarter.<\/p>\n
StubHub reported adjusted EBITDA of $105.7 million, up 94% from a year earlier.<\/p>\n
SOPA Images via Getty Images<\/p>\n
Bank of America sees slower growth ahead<\/p>\n
The bigger concern extends into 2027.<\/p>\n
BofA cut its 2027 GMS estimate by roughly 5% to about $10.8 billion from $11.3 billion. The firm also reduced its 2027 adjusted EBITDA estimate to $499 million from $521 million.<\/p>\n
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Post expects StubHub’s GMS growth to trail the broader internet sector next year, while the company will also face difficult comparisons against its World Cup-driven performance in the second quarter of 2026.<\/p>\n
The analyst also changed the way BofA values the company, moving from a sum-of-the-parts approach to a total EBITDA methodology.<\/p>\n
BofA now applies a 7.8 times multiple to projected 2027 EBITDA, less estimated net debt, producing the new $7.50 price objective.<\/p>\n
Post argues that StubHub deserves a discount to the roughly 13 times multiple assigned to BofA’s broader gig economy and entertainment comparison group because of its slower expected growth.<\/p>\n
The Federal Trade Commission confirmed an April settlement requiring StubHub to provide $10 million in consumer redress over allegations involving mandatory ticket-fee disclosures.<\/p>\n
House Oversight Committee Democrats also sent CEO Eric Baker a letter in July requesting information about StubHub’s relationships with professional ticket resellers and an affiliated investment fund.<\/p>\n
Stronger NFL and NBA ticket demand, major 2027 concert tour announcements, improving advertising initiatives, and strong free-cash-flow conversion could all provide upside.<\/p>\n
Related: StubHub unveils first-of-its-kind program for festival fans<\/p>\n
#Analyst #resets #StubHub #stock #outlook #record #quarter<\/p>\n","protected":false},"excerpt":{"rendered":"
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