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Lowest EV/EBITDA Ratio in the Movies & Entertainment Industry Detected for Lions Gate Entertainment (LGF, CKEC, TIXC)

Published on Wed, 02/20/2013 - 11:18
By Peter Chu

Below are the three companies in the Movies & Entertainment industry with the lowest enterprise value to EBITDA (EV/EBITDA) ratios. EV/EBITDA is an important metric used in valuing comparable companies. It is capital structure neutral and generally the lower the ratio, the more undervalued the company is believed to be.

Lions Gate Entertainment (NYSE:LGF) is lowest with an EV/EBITDA ratio of 4.48. Lions Gate Entertainment Corp. develops, produces, and distributes filmed entertainment content. The Company's divisions produce motion pictures, television programming, animation, and digital media. Lions Gate distributes its films and other media in the United States, Canada, and internationally. Lions Gate Entertainment has traded 188,000 shares thus far today, vs. average volume of 1.3 million shares per day. The stock has underperformed the Dow (-1.1% to the Dow's -0.0%) and underperformed the S&P 500 (-1.1% to the S&P's -0.3%) during today's trading.

Carmike Cinemas (NASDAQ:CKEC) is next with an EV/EBITDA ratio of 5.03.

Finishing up the bottom three is Tix (NASDAQ:TIXC), with an EV/EBITDA ratio of 6.06.

By Peter Chu