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Lionsgate Studios (LION)
NYSE:LION
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Lionsgate Studios
(NYSE:LION)
Select Model
Select Model
Rating:47Neutral
Price Target:
$9.00
▲(0.00% Upside)
Action:ReiteratedDate:02/28/26
The score is primarily held back by weak financial quality—negative equity, ongoing net losses, and recent negative operating/free cash flow. Technicals are only moderately supportive (improved longer-term trend but weak MACD), while valuation is constrained by unprofitability (negative P/E). Earnings call guidance and visibility (record library revenue and higher backlog) provide some offset, but elevated leverage and near-term cash usage remain key risks.
Positive Factors
Recurring Library Revenue
A record $1.05B trailing‑12‑month library revenue (up 10% YoY) signals a durable, recurring monetization engine. Library licensing and growing TV-series share provide steady, lower‑variance cash flows versus theatrical windows and support long‑term revenue resilience.
Backlog and Pipeline Visibility
A $1.5B backlog up 26% with ~80% expected to convert within 15 months gives multi‑quarter visibility into revenues and cash flows. This near‑term pipeline reduces forecasting risk and underpins management’s organic deleveraging and production planning initiatives.
Franchise and Renewal Strength
High renewal rates (12/13 scripted renewals) and a portfolio of 40+ franchises create repeatable IP monetization opportunities. Franchises and renewals lower single‑title concentration risk and support sequels, licensing, and ancillary revenue over multiple years.
Negative Factors
Negative Shareholders' Equity
A materially negative equity position (~-$1.28B TTM) undermines financial resilience and reduces flexibility to absorb shocks. Negative equity complicates lender and supplier confidence, constrains strategic options, and increases the likelihood of restrictive covenants or equity‑raising needs.
Elevated Leverage
Net debt of $1.75B and 7.4x leverage at quarter end represent a material capital structure strain. High leverage raises refinancing and interest‑cost risk, limits flexibility for content investment, and makes the company sensitive to any EBITDA swings until planned deleveraging occurs.
Negative Operating and Free Cash Flow
Recent return to negative operating (-$65.6M TTM) and free cash flow (-$78.9M TTM) implies cash generation is inconsistent. Persistent cash burn constrains reinvestment, increases dependence on financing or asset monetization, and can delay deleveraging despite improving top‑line trends.
Lionsgate Studios (LION) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.61B
Dividend YieldN/A
Average Volume (3M)2.37M
Price to Earnings (P/E)―
Beta (1Y)0.81
Revenue Growth97.19%
EPS Growth-21.46%
CountryUS
Employees1,717
SectorConsumer Cyclical
Sector Strength84
IndustryEntertainment
Share Statistics
EPS (TTM)0.01
Shares Outstanding290,187,260
10 Day Avg. Volume2,231,169
30 Day Avg. Volume2,367,266
Financial Highlights & Ratios
PEG Ratio-0.11
Price to Book (P/B)-2.07
Price to Sales (P/S)0.95
P/FCF Ratio-33.56
Enterprise Value/Market Cap0.99
Enterprise Value/Revenue0.93
Enterprise Value/Gross Profit2.70
Enterprise Value/Ebitda1.99
Forecast
1Y Price Target
$11.08Price Target Upside23.11% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering6
EPS Forecast (FY)-0.18
Revenue Forecast (FY)$2.56B
Lionsgate Studios Business Overview & Revenue Model
Company DescriptionLionsgate Studios is one of the world’s leading standalone, pure play, publicly-traded content companies. It brings together diversified motion picture and television production and distribution businesses, a world-class portfolio of valuable brands and franchises, a talent management and production powerhouse and a more than 20,000-title film and television library, all driven by Lionsgate’s bold and entrepreneurial culture.
How the Company Makes MoneyLionsgate generates revenue through several key streams, including theatrical distribution of films, television licensing, and digital streaming. The company earns money by producing and distributing films that perform well at the box office, as well as through licensing content to television networks and streaming platforms. Additionally, Lionsgate benefits from home entertainment sales, including DVD and Blu-ray sales, as well as digital downloads and rentals. The company has established significant partnerships with various streaming services, which provide a steady revenue influx through licensing agreements. Furthermore, Lionsgate's extensive catalog of intellectual properties allows it to monetize its content through merchandising and ancillary products, contributing to its overall earnings.
Lionsgate Studios Earnings Call Summary
Earnings Call Date:Feb 05, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:May 21, 2026
Earnings Call Sentiment Positive
The call communicated a mix of encouraging operating momentum and substantial near-term financial pressures. Positives include record library revenue (up 10% YoY to $1.05B), strong Motion Picture topline growth (+35% to $421M), a deep franchise slate, renewals of nearly all scripted series (12 of 13), and a 26% increase in backlog giving visibility into future cash flows. Offsetting these strengths are elevated leverage (net debt $1.75B; 7.4x leverage), GAAP losses (EPS -$0.16), negative operating cash flow (-$109M) and quarter-to-quarter profit timing impacts from heavy P&A spend (~$100M) and episodic delivery timing. Management projects meaningful improvement in Q4 adjusted OIBDA, organic deleveraging into mid-4x by mid fiscal '27 and further progress into fiscal '28, which together with the strong slate and library momentum underpin a cautiously optimistic outlook.Q3-2026 Updates
Positive Updates
Consolidated Revenue and Profitability Metrics
Q3 fiscal 2026 revenue increased 1% year-over-year to $724 million. Adjusted OIBDA was $85 million and operating income was $36 million. Reported fully diluted loss per share was $0.16 while fully diluted adjusted earnings were $0.01 per share.
Motion Picture Revenue Growth
Motion Picture revenue grew 35% year-over-year to $421 million, driven by releases including Now You See Me: Now You Don't (nearly $250M worldwide), The Housemaid and Good Fortune.
Record Library Performance
Trailing 12-month library revenue reached an all-time high of $1.05 billion, up 10% year-over-year and marking the fifth consecutive record quarter.
Robust Backlog and Pipeline Visibility
Backlog increased 26% year-over-year to $1.5 billion (80% of which is expected to convert to revenue/cash flow within the next 15 months), providing significant near-term visibility into revenues.
Studio Segment Profit Momentum
Studio segment profit grew sequentially throughout the fiscal year and was $114 million in the quarter, reflecting back-end loaded cadence and alignment with peer studio OIBDA comparisons.
Franchise and Slate Strength
Company highlighted a slate of tentpoles and franchises (Michael, Hunger Games: Sunrise on the Reaping, Resurrection of the Christ Parts 1 & 2, John Rambo, Dirty Dancing, John Wick, Naruto, Saw, Blair Witch) and more than 40 active franchise properties spanning film, TV, games and live experiences.
TV Renewals and Series Performance
Television group secured renewals for 12 of 13 scripted series across 12 different buyers; notable hits include The Hunting Wives (Netflix), The Rainmaker (USA Network), Robinhood (MGM+), The Rookie (ABC), and Spartacus: House of Ashur (Starz).
Marketing and Audience Momentum for Michael
Trailer for Michael set internal view records for music biopic trailers and early screenings have generated very positive response; management reports strong engagement metrics and significant IMAX/large-format commitments for the April rollout.
Strategic AI Initiatives and Partnerships
Appointed a Chief AI Officer to integrate AI across the business; active partnership/experimentation with Runway and use cases cited include postproduction, VFX, previsualization and FAST channel optimization.
Diversified Library Monetization and FAST Growth
33% of record library revenue this quarter came from television series (vs ~10% ten years ago). FAST/AVOD/add-on channels and transactional EST/VOD are growing contributors: FAST ~6% of trailing 12 revenue with a target of 10–15% next year; EST/VOD ~10%.
Negative Updates
Net Loss and Weak GAAP Earnings
Reported GAAP fully diluted loss per share was $0.16 for the quarter, indicating the company remains unprofitable on a reported basis despite modest adjusted EPS of $0.01.
Cash Flow Usage and Free Cash Flow Pressure
Net cash flow used in operating activities was $109 million and adjusted free cash flow used was $58 million in the quarter, reflecting near-term cash burn tied to theatrical and TV timing.
High Leverage at Quarter End
Net debt was $1.75 billion and leverage increased to 7.4x due to lower trailing 12-month adjusted EBITDA; management called this peak leverage and expects deleveraging but current levels are elevated.
Motion Picture Segment Profit Decline from Timing
Although Motion Picture revenue rose 35%, segment profit declined year-over-year to $59 million primarily because of timing of P&A spend tied to three wide theatrical titles and approximately $100 million of U.S. P&A in the quarter.
Television Revenue and Profit Down Year-over-Year
TV revenue ($303 million) and segment profit ($56 million) were down year-over-year due to timing of episodic deliveries and a difficult prior-year comparison (inaugural season of The Studio contributed in the prior year).
Reliance on Carryover and Tentpoles for Near-Term Recovery
Management emphasized carryover box office (e.g., The Housemaid) and upcoming tentpoles (Michael, Hunger Games, Resurrections) as drivers of Q4 and fiscal '27 improvement—introducing execution and concentration risk if pay-one/home or theatrical performance disappoints.
Industry Uncertainty and Buyer Variability
Management noted some buyers have slowed due to consolidation and M&A activity; while they see new buyers and opportunities, this dynamic creates variability in commissioning and monetization windows.
Company Guidance
Management guided that Q4 adjusted OIBDA should improve materially from Q3 and that the company is on track to deliver strong adjusted OIBDA growth in fiscal ’27 (relative to fiscal ’25), driven by three fiscal ’27 tentpoles and a planned doubling of scripted episodic deliveries in fiscal ’27; Q3 studio results were revenue $724M, adjusted OIBDA $85M, operating income $36M, reported loss per share $0.16 and adjusted EPS $0.01, with net cash used in operations $109M and adjusted free cash flow use $58M. Motion Picture revenue was $421M (up 35% YoY) with segment profit $59M and ~ $100M of U.S. P&A this quarter (additional Q4 P&A for April’s Michael), TV revenue was $303M with segment profit $56M, trailing 12‑month library revenue reached a record $1.05B (up 10% YoY) with 33% from TV series, backlog rose 26% YoY to $1.5B (~80% of which is expected to convert in the next 15 months), net debt was $1.75B with leverage at 7.4x (revolver $770M undrawn, cash $213M) and management expects leverage to fall to the mid‑4s by mid‑FY27 and to ~3–3.5x in FY28; operational highlights supporting the guidance included 12 of 13 scripted renewals, more than 40 active franchises, strong box‑office carryover (Now You See Me ~ $250M worldwide) and the Housemaid release (mostly contributing in Q4 and into fiscal ’27).Lionsgate Studios Financial Statement Overview
Summary
Top-line momentum is strong (TTM revenue +37.7%) with decent gross margin (~33%), but overall fundamentals are weighed down by persistent net losses (TTM net margin ~-7%), a structurally weak balance sheet with negative equity (TTM ~-$1.28B), and a return to cash burn (TTM operating cash flow -$65.6M; TTM free cash flow -$78.9M).Income Statement
Revenue growth is strong in TTM (Trailing-Twelve-Months) (+37.7%) after a modest FY2025 increase (+7.0%), indicating improving top-line momentum. Gross margin is decent (~33% TTM), but profitability remains pressured: net losses persist (TTM net margin about -7.0%) and EBIT margin is thin (~1.9% TTM), suggesting costs and/or amortization/other charges are limiting earnings conversion despite healthy EBITDA margins.57
Neutral
Balance Sheet
The balance sheet is the key weakness: stockholders’ equity is negative across all periods (TTM roughly -$1.28B), which undermines financial flexibility and makes leverage harder to assess on a traditional basis. While reported total debt is low in TTM ($159M) versus prior fiscal years (~$3.2–$3.7B), the negative equity position remains a material risk and increases sensitivity to operating setbacks or refinancing needs.28
Negative
Cash Flow
Cash generation has become inconsistent. After strong positive operating cash flow and free cash flow in FY2023–FY2024 (both positive and sizable), TTM (Trailing-Twelve-Months) and FY2025 swing back to negative operating cash flow (-$65.6M TTM; -$106.8M FY2025) and negative free cash flow (-$78.9M TTM; -$120.3M FY2025). A positive note is that free cash flow is less negative versus FY2025 (TTM free cash flow growth is strongly positive), but the current cash burn profile is still a concern.34
Negative
| Breakdown | Mar 2025 | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 2.79B | 3.20B | 2.99B | 3.08B | 2.72B |
| Gross Profit | 662.30M | 985.50M | 1.10B | 875.90M | 794.20M |
| EBITDA | 921.50M | 1.77B | 334.80M | 1.84B | 1.68B |
| Net Income | -246.70M | -128.50M | -93.50M | -300.00K | 11.10M |
Balance Sheet | |||||
| Total Assets | 5.24B | 5.12B | 5.10B | 4.41B | 4.33B |
| Cash, Cash Equivalents and Short-Term Investments | 182.40M | 205.70M | 277.00M | 210.90M | 256.90M |
| Total Debt | 159.00M | 3.66B | 3.72B | 3.18B | 2.76B |
| Total Liabilities | 6.38B | 6.04B | 6.13B | 4.85B | 4.26B |
| Stockholders Equity | -1.28B | -1.05B | -1.15B | -780.40M | -261.30M |
Cash Flow | |||||
| Free Cash Flow | -78.90M | -120.30M | 479.00M | 339.60M | -441.10M |
| Operating Cash Flow | -65.60M | -106.80M | 488.90M | 346.10M | -435.00M |
| Investing Cash Flow | -11.40M | -35.40M | -331.80M | 31.30M | -180.70M |
| Financing Cash Flow | -13.50M | 84.50M | -74.90M | -394.50M | 525.50M |
Lionsgate Studios Technical Analysis
Positive
9.00
Price Trends
8.94
Positive
7.86
Positive
7.16
Positive
Market Momentum
-0.14
Positive
55.07
Neutral
50.76
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LION, the sentiment is Positive. The current price of 9 is above the 20-day moving average (MA) of 8.71, above the 50-day MA of 8.94, and above the 200-day MA of 7.16, indicating a bullish trend. The MACD of -0.14 indicates Positive momentum. The RSI at 55.07 is Neutral, neither overbought nor oversold. The STOCH value of 50.76 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for LION.
Lionsgate Studios Risk Analysis
Lionsgate Studios disclosed 37 risk factors in its most recent earnings report. Lionsgate Studios reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Lionsgate Studios Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $406.34B | 38.08 | 42.76% | ― | 15.49% | 35.54% | |
69 Neutral | $187.85B | 15.62 | 11.65% | 1.10% | 3.61% | 152.34% | |
68 Neutral | $22.93B | 13.56 | 16.87% | 0.75% | 14.91% | 9.30% | |
62 Neutral | $69.86B | 98.02 | 2.08% | ― | -4.29% | ― | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
50 Neutral | $14.91B | -30.48 | -4.43% | 1.48% | -0.48% | 97.09% | |
47 Neutral | $2.61B | -10.28 | ― | ― | 97.19% | -21.46% |
* Consumer Cyclical Sector Average
LION
Lionsgate Studios
9.00
0.62
7.40%
PSKY
Paramount Skydance
13.51
2.37
21.26%
DIS
Walt Disney
106.04
-5.52
-4.95%
NFLX
Netflix
96.24
-1.13
-1.16%
FOXA
Fox
56.34
-0.15
-0.27%
WBD
Warner Bros
28.17
17.15
155.63%
Lionsgate Studios Corporate Events
Business Operations and StrategyExecutive/Board Changes
Lionsgate Studios Adds Mnuchin, Strikes Governance Pact
Positive
Jan 26, 2026
On January 26, 2026, Lionsgate Studios entered into a governance, standstill and voting agreement with Liberty 77-affiliated funds and MHR Fund Management that installs Liberty Strategic Capital’s managing partner and former U.S. Treasury Secretary Steven T. Mnuchin as a Liberty-designated independent director on its board, bringing the total number of directors to eleven. Under the deal, Liberty 77 and MHR have agreed to mutual voting support for each other’s board nominees and to refrain from activist measures such as increasing their stakes above 17.5%, launching proxy contests or other actions that could challenge Lionsgate’s governance structure for a defined multi-year period, while receiving pre-emptive, registration and “most favored nation” rights aligned with existing major shareholders; the company does not anticipate Mnuchin’s appointment will materially alter its operations but expects his financial, regulatory and entertainment experience, as well as the alignment with significant shareholders, to reinforce board oversight and governance stability for investors.
The most recent analyst rating on (LION) stock is a Hold with a $10.00 price target. To see the full list of analyst forecasts on Lionsgate Studios stock, see the LION Stock Forecast page.
Regulatory Filings and ComplianceShareholder Meetings
Lionsgate Studios Sets Timetable for 2026 Shareholder Meeting
Neutral
Jan 9, 2026
Lionsgate Studios Corp. has scheduled its initial annual general and special meeting of shareholders for March 17, 2026, to be held at its Canadian head office, with further details to be provided in a forthcoming proxy statement. The company has established January 20, 2026, as the deadline for shareholder proposals to be included in the proxy materials under Rule 14a-8, and February 13, 2026, as the cutoff for eligible shareholders to submit director nominations, reinforcing formal governance processes and providing a clear timetable for investor participation in corporate decision-making.
The most recent analyst rating on (LION) stock is a Buy with a $11.00 price target. To see the full list of analyst forecasts on Lionsgate Studios stock, see the LION Stock Forecast page.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.