SFX Entertainment, an electronic music festival company, skyrocketed 30 percent upwards on Feb. 25 due to their CEO Robert F. Sillerman announcing to pay a big premium on their current trading price, to take the company private. The privatization news made SFXE stockholders happy, bittersweet, furious and wealthier all at the same time. Whether stockholders of SFXE Entertainment are happy or not, they sure did grab a quick huge profit. Many analysts and online business media news sources have reported the CEO of this company as a major defense against buying into the shares. There is a lot of negative news on the CEO and his legal battles with the company. Their stock price has progressively fallen over the last two years, but this past week their stock price had a reversal and went from $3.70 to more than $5.00 by Feb. 26. Many shareholders sold their positions as the price shot up early Feb. 25 morning on the news of a possible privatization process occurring. Their largest competitor is Live Nation, which produces and sells out concerts throughout the United States and overseas. SFX Entertainment has been on my watch list for the last couple of months because they are one of the few electronic music festival companies on the scene. They host the Tomorrow Land Festival, Q-Dance Music Festival and many other electronic music festivals through competing electronic music festival companies they have acquired this past year. The electronic music market is growing very quickly as young students and young professionals purchase more tickets to festivals. More young people today can relate to their weekend experiences at music festivals than ten years ago. The music festival market has great growth potential. I would not be surprised if we see more electronic music festival companies being created as the market continues to grow. Also, I would not be surprised if SFX Entertainment’s board finds a new CEO, one who wants to keep the company public and attract more investors.
Spring Stock Holding Update
On Feb. 9, I introduced four publicly traded companies’ stock, which I myself also purchased. I also strongly recommend you readers and market enthusiasts to follow or copy me because I have researched these four companies and their markets in depth from a macro perspective. I have taken into account the future possibility of interest rates rising and the U.S. dollar strengthening. I have taken into account the effects of lower oil and commodity prices. The latest changes in macro market conditions have greatly affected the potentials for this year. I have diversified my portfolio into four different sectors, to prevent big losses if a downfall in one of my holdings’ sectors were to occur. Below shows the current 9.5 percent gain through yesterday beating the general market indexes. (S&P500 has gained 3.6 percent and the Dow Jones Industrial Average has gained 3.2 percent since Feb. 9.)