Alliance Entertainment Q2 net income rises 33% yr/yr

Overview

• Entertainment distributor's Q2 revenue and adjusted EBITDA missed analyst expectations

• Net income for Q2 increased 33% yr/yr to $9.4 mln

• Company completed acquisition of Endstate, expanding into authenticated collectibles

Outlook

• Alliance Entertainment did not provide specific financial guidance for future quarters

Result Drivers

• PHYSICAL MEDIA DEMAND - Physical movie revenue increased 33% yr/yr to $114 mln, driven by demand for premium formats and exclusive partnerships

• AUTHENTICATED COLLECTIBLES - Acquisition of Endstate and launch of Endstate Authentic platform expanded co's role into authenticated collectibles

• GROSS MARGIN EXPANSION - Gross margin expanded 210 basis points to 12.8%, driven by favorable mix and higher-value products

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 3 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the electronic equipment & parts peer group is "buy"

• Wall Street's median 12-month price target for Alliance Entertainment Holding Corp is $10.00, about 45.6% above its February 11 closing price of $6.87

• The stock recently traded at 11 times the next 12-month earnings vs. a P/E of 11 three months ago

Press Release: ID:nGNX2YTklt

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