History Says Bet on a Down Month for Entertainment Stock

Betting on LYV's next leg lower with options looks like the right move

Deputy Editor
Apr 1, 2024 at 10:46 AM
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Entertainment stock Live Nation Entertainment Inc (NYSE:LYV) is hovering near two-year highs, though today its trading 0.5% lower at $105.32 at last glance, and pacing pacing for its fourth daily loss in six. This could be the start of a downtrend for LYV, as its entering a historically tumultuous month.

Per data from Schaeffer's Senior Quantitative Analyst Rocky White, Live Nation Entertainment stock is one of the worst S&P 500 Index (SPX) stocks to own in April. In fact, it's the second-worst stock to own this month, as its finished lower 80% of the time over the past 10 years with an average 2.5% loss. From its current perch, a move of similar magnitude would put the security just below $102.70, or an area not seen since mid-March.

An unwinding of analysts' optimism could also weigh on the stock. All 16 of the covering brokerages rate LYV a "buy" or better. Betting on Live Nation Entertainment stock's next move with options seems like the right play. The equity's Schaeffer's Volatility Index (SVI) of 22% ranks in the low 4th percentile of its annual range, meaning options traders are pricing in low volatility expectations at the moment. 

 

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