Reviewing Lionsgate Studios (NYSE:LION) & Sphere Entertainment (NYSE:SPHR)

Sphere Entertainment (NYSE:SPHR) and Lionsgate Studios (NYSE:LION) are both mid-cap consumer discretionary companies, but which is the better business? We will contrast the two companies based on the strength of their earnings, institutional ownership, profitability, dividends, analyst recommendations, risk and valuation.

Insider & Institutional Ownership

92.0% of Sphere Entertainment shares are owned by institutional investors. 22.1% of Sphere Entertainment shares are owned by insiders. Comparatively, 9.4% of Lionsgate Studios shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares Sphere Entertainment and Lionsgate Studios”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sphere Entertainment	$1.03 billion	3.22	-$200.65 million	($5.17)	-18.12
Lionsgate Studios	$3.11 billion	0.85	-$125.30 million	($0.67)	-13.63

Lionsgate Studios has higher revenue and earnings than Sphere Entertainment. Sphere Entertainment is trading at a lower price-to-earnings ratio than Lionsgate Studios, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Sphere Entertainment has a beta of 1.71, indicating that its stock price is 71% more volatile than the S&P 500. Comparatively, Lionsgate Studios has a beta of -0.48, indicating that its stock price is 148% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and target prices for Sphere Entertainment and Lionsgate Studios, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sphere Entertainment	2	4	7	0	2.38
Lionsgate Studios	2	4	8	1	2.53

Sphere Entertainment currently has a consensus price target of $78.70, indicating a potential downside of 15.99%. Lionsgate Studios has a consensus price target of $9.14, indicating a potential upside of 0.07%. Given Lionsgate Studios’ stronger consensus rating and higher possible upside, analysts clearly believe Lionsgate Studios is more favorable than Sphere Entertainment.

Profitability

This table compares Sphere Entertainment and Lionsgate Studios’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sphere Entertainment	-13.87%	-17.20%	-8.89%
Lionsgate Studios	-6.97%	N/A	-1.33%

Summary

Lionsgate Studios beats Sphere Entertainment on 11 of the 15 factors compared between the two stocks.

About Sphere Entertainment

Sphere Entertainment Co. engages in the entertainment business. It produces, presents, or hosts various live entertainment events, including concerts, family shows, and special events, as well as sporting events, such as professional boxing, college basketball and hockey, professional bull riding, mixed martial arts, and esports and wrestling in its venues, including The Garden, Hulu Theater, Radio City Music Hall, and the Beacon Theatre in New York City; and The Chicago Theatre. The company also operates entertainment dining and nightlife venues markets under the Tao, Marquee, Lavo, Beauty & Essex, Cathédrale, Hakkasan, and Omnia brand names. The company was formerly known as Madison Square Garden Entertainment Corp. and changed its name to Sphere Entertainment Co. in April 2023. Sphere Entertainment Co. was founded in 2006 and is based in New York, New York.

About Lionsgate Studios

Lionsgate Studios Corp. engages in the provision of motion picture and studio operations that bring a varied portfolio of entertainment to consumers. The company is headquartered in Santa Monica, CA.