Brian Smith, Jr.

SFX Entertainment: It's Time To Turn Down The Dance Music And Sober Up

SFX Entertainment (NASDAQ:SFXE) touts in its first earnings release as a public company that the "revolution has begun," with the electronic music festival company growing its attendance by 40% pro-forma for its myriad acquisitions in the quarter. However, in my view, the press release stood out more for all of the (non-GAAP) EBITDA adjustments and caveats in the footnotes of its release, which were naturally rubber-stamped by the investment banks who took the company public and are drooling over a line of M&A advisory deals on the horizon given the company's roll-up strategy.

So first let's focus on these adjustments and then address the company more broadly:

The company reported $12.844 million in pro-forma EBITDA, although before adjustments...

Join Seeking Alpha PRO to read this archived article and 11,574 other archived articles
IDEA GENERATORXExclusive access to 10 PRO ideas every day
INVESTING IDEAS LIBRARYXExclusive access to PRO library of more than 15,000 ideas
SECTOR EXPERT NETWORKXExclusive access to all sector experts for direct consultation
PERFORMANCE TRACKINGXTrack performance of all PRO stock ideas
PROFESSIONAL TOOLSXProfessional Idea Filters to zero-in based on industry, market cap and more
"In just the first month of using PRO, I used it to generate two ideas which were actionable for me. As a result of these two positions, I have earned more than 20 times the annual subscription costs for PRO."Michael Yagemann, Greenbridge Capital
"I am pleasantly surprised with the scope of small and mid-cap coverage PRO offers. You can't find that any where else."Patrick Rice, Mainstay Capital Management
You may cancel at any time for any reason, and receive a prompt refund for membership on months paid and not used (max. 6 months). Details