Key Stats for Lionsgate Studios Stock
- Price change for Lionsgate Studios stock: 16%
- $LION Share Price as of May. 22: $15
- 52-Week High: $15
- $LION Stock Price Target: $15
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What Happened?
Lionsgate (LION) stock surged 16% on Friday after the company reported strong fiscal Q4 results and Wells Fargo doubled down on its bullish thesis.
The numbers were solid, with adjusted OIBDA hitting a 12-year high of $165 million, up 17% year-over-year.
Operating income jumped over 50%, and free cash flow for the quarter was $190 million. The company ended the fiscal year with leverage down more than a full turn to 6.1x.
The bigger story is what’s coming next.
- Wells Fargo analyst Omar Mejias reaffirmed his Overweight rating and $16 price target, saying Lionsgate’s “earnings power is inflecting after a trough year.”
- He pointed to a loaded film slate, a near-doubling of TV episodic deliveries, a $1 billion library, and a $1.3 billion backlog as the building blocks for EBITDA approaching $400 million by FY27 to FY28.
The catalyst that’s really moving Lionsgate stock today is Michael. The Michael Jackson biopic is on track to surpass $1 billion at the worldwide box office — which would be Lionsgate’s first-ever billion-dollar film.
Japan hasn’t even opened yet. Michael 2 is already in development, with roughly 25% to 30% of the second film already shot from the original production.
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What the Market Is Telling Us About Lionsgate Studios Stock
The setup for Lionsgate stock looks compelling on multiple fronts.
- The film pipeline is strong. Hunger Games: Sunrise on Reaping, The Housemaid 2, and Mel Gibson’s two-part Resurrection of the Christ series are all lined up to extend the runway through FY28.
- TV business is set to nearly double episodic deliveries in fiscal 2027, with 12 of 13 scripted series renewed.
- The library is also generating consistent income.
- Lionsgate has posted $1 billion or more in trailing 12-month library revenue for three straight quarters — a level of consistency that provides a stable floor even in volatile markets.
The wildcard is M&A.
- With Paramount/Skydance and Warner Bros. Discovery potentially combining, the field of independent studios is shrinking fast.
- Wells Fargo’s Mejias called Lionsgate “the next logical studio drawn into the fray” and noted that a competitive acquisition process could attract several traditional buyers.
- The company’s IP library is also valued by tech and AI companies seeking content to train large language models.
Management addressed the strategic optionality directly. CEO Jon Feltheimer noted the company has “maximum optionality” following its separation from Starz and collapse into a single share class. The poison pill expired in May, removing a barrier to potential deals.
Lionsgate stock still has room to run if the FY27 earnings trajectory plays out as expected.
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How Much Upside Does Lionsgate Studios Stock Have From Here?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
