Education
About Us
Working with TipRanks
Follow Us
Starz Entertainment Corp (STRZ)
NASDAQ:STRZ
Top Page
Starz Entertainment Corp
(NASDAQ:STRZ)
Select Model
Select Model
Rating:52Neutral
Price Target:
$13.00
▲(4.84% Upside)
Action:ReiteratedDate:03/19/26
The score is held back primarily by weak financial performance (revenue contraction, continued net losses, and negative free cash flow), partially offset by improving balance-sheet metrics. Technicals are moderately positive, and the latest earnings call improved the outlook with explicit 2026 free-cash-flow and deleveraging guidance. Valuation remains challenging due to unprofitability and no dividend support.
Positive Factors
Subscriber Growth
Sustained OTT subscriber additions expand the recurring revenue base and scale economics, supporting higher lifetime value and stronger content monetization. Durable subscriber growth underpins long-term revenue stability and aids margin expansion as fixed content costs spread over more paying users.
Improved Balance Sheet
Leverage at about one-to-one and restored positive equity reduce solvency risk versus prior periods, giving management flexibility to fund content and execute deleveraging. A more manageable capital structure lowers refinancing stress and supports multi-year strategic investments.
Clear FCF & Deleveraging Path
Explicit multi-year targets for positive unlevered free cash flow and lower leverage provide a credible roadmap to self-funded operations. If achieved, converting OIBDA to FCF improves liquidity, reduces reliance on external capital, and materially strengthens long-term financial resilience.
Negative Factors
Negative Cash Generation
Persistent negative operating and free cash flow limit the firm's ability to fund content, marketing, and debt service internally. Until cash conversion sustainably turns positive, the company faces refinancing and liquidity risk that can constrain strategic investments and margin recovery.
Revenue Contraction
A substantial top-line decline erodes scale benefits from content and distribution, pressuring long-term profitability and delaying targeted margin goals. Continued revenue erosion reduces bargaining power with partners and makes durable margin improvement harder without new growth drivers.
Content Concentration & Reduced Transparency
Heavy reliance on a few franchises concentrates creative and revenue risk: underperformance or timing gaps can stall growth and margins. Stopping subscriber disclosures reduces investor visibility into operating trends, complicating assessment of long-term subscriber-driven monetization.
Starz Entertainment Corp (STRZ) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$208.09M
Dividend YieldN/A
Average Volume (3M)185.79K
Price to Earnings (P/E)―
Beta (1Y)-0.57
Revenue Growth-2.85%
EPS Growth75.96%
CountryUS
Employees1,717
SectorCommunication Services
Sector Strength97
IndustryEntertainment
Share Statistics
EPS (TTM)-3.95
Shares Outstanding16,781,237
10 Day Avg. Volume211,895
30 Day Avg. Volume185,789
Financial Highlights & Ratios
PEG Ratio0.01
Price to Book (P/B)0.24
Price to Sales (P/S)0.14
P/FCF Ratio-2.94
Enterprise Value/Market Cap3.82
Enterprise Value/Revenue0.41
Enterprise Value/Gross Profit0.85
Enterprise Value/Ebitda0.74
Forecast
1Y Price Target
$22.00Price Target Upside77.42% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
EPS Forecast (FY)-2.6
Revenue Forecast (FY)$1.28B
Starz Entertainment Corp Business Overview & Revenue Model
Company DescriptionStarz Entertainment Corp. provides subscription video programming to consumers in the United States and Canada. Its business consists of the distribution of STARZ-branded premium subscription video services through over-the-top platforms and distributors on a direct to-consumer basis through the STARZ-branded app and through multichannel video programming distributors. The company is based in Vancouver, Canada.
How the Company Makes Moneynull
Starz Entertainment Corp Earnings Call Summary
Earnings Call Date:Feb 26, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 21, 2026
Earnings Call Sentiment Positive
The call was broadly positive: Starz reported strong subscriber growth, exceeded its 2025 adjusted OIBDA target, showed significant sequential OIBDA improvement, and provided constructive 2026 guidance for positive free cash flow and continuing deleveraging. Strategic moves to increase owned content, international co-commissions (Sky), and expanded bundling/distribution partnerships underpin the growth and margin pathway. Key risks highlighted include ongoing linear declines, seasonal promotion-driven revenue pressure, prior cadence volatility as cash/content timing is normalized, modest cash on hand relative to debt, and reduced transparency from ceasing subscriber disclosures. Overall, the positive operational and financial progress and clear forward guidance outweigh the noted challenges.Q4-2025 Updates
Positive Updates
Record OTT Subscriber Growth
OTT subscribers reached an all-time high of 12.7 million, up 7.6% year-over-year; added 370,000 domestic OTT subscribers in Q4 and grew total U.S. subscribers by 170,000 in the period (to 17.6 million).
Exceeded Full-Year Adjusted OIBDA Target
Delivered $204 million of adjusted OIBDA for 2025, exceeding the $200 million outlook by ~2%.
Quarterly Adjusted OIBDA and Revenue Momentum
Q4 adjusted OIBDA was $56 million, up over 100% sequentially (driven by lower programming amortization, lower ad/marketing spend and higher revenue); total revenue for the quarter was $323 million, up 60 basis points sequentially.
Clear 2026 Cash Flow and Leverage Guidance
Management expects 2026 unlevered free cash flow of $80 million to $120 million (positive equity free cash flow for the year) and to exit 2026 with ~2.7x leverage (improving from 2.9x at year-end 2025).
Progress on De-aging and Ownership of Content
Greenlit and completed production on first wholly owned series Fightland (co-commissioned with Sky), greenlit Power Origins (18-episode order), launched Outlander prequel Blood of My Blood — moves intended to increase owned slate and future margin/royalty upside.
Strategic Distribution & Bundling Momentum
Restructured Canadian business into licensing revenue; expanding bundling and distribution partnerships (management cites bundles as expanding TAM, driving net new additions, revenue accretion and better retention).
Programming Success Driving Engagement
Strong creative performance: Spartacus revival received critical acclaim and Power Book IV: Force Season 3 delivered 57% in-season viewership growth, fueling subscriber adds and engagement.
Negative Updates
Linear Declines and Holiday Promotion Impact
Linear subscribers continued to decline; quarter faced declines in linear and OTT revenue partially due to heavy holiday seasonal promotions and lower-churn multi-month plans, pressuring near-term revenue composition.
Reduced Subscriber Disclosure
Management will stop disclosing subscriber counts starting with the March 2026 quarter, which reduces a previously key operating metric and may concern some investors about transparency.
Balance Sheet and Liquidity Considerations
Net debt was $589 million with gross debt $625 million; cash on hand was $36 million and the $150 million revolver remained undrawn — leverage remains a focal constraint (targeting 2.5x long-term).
Historical Cash/Content Cadence Volatility
Company acknowledged prior volatile cash flow and P&L cadence tied to transitioning away from studio cash timing; while they expect improvement in 2026, near-term synchronization work remains.
Concentration Risk on Franchises and Timing for Margin Expansion
Margin expansion to 20% is projected by 2028 with only modest improvement in 2026; much of near-term subscriber and revenue momentum relies on a slate of established franchises (Power, Outlander) which can concentrate performance risk.
Company Guidance
Starz said 2026 should be an inflection year, with OTT revenue expected to grow and adjusted OIBDA to increase low single‑digit percent versus 2025 (2025 adjusted OIBDA was $204M), while generating $80–$120M of unlevered free cash flow and converting the business to positive equity free cash flow; management expects to exit 2026 at roughly 2.7x leverage (improving from 2.9x at year‑end 2025 and better than the prior 3.1x guide, on a path toward a 2.5x target), with cash content spend under ~$650M, another year of at least $200M adjusted OIBDA, and longer‑term targets of ~20% margins by exit‑2028 and converting 70% of adjusted OIBDA to unlevered FCF — all against a 2025 operational base of 12.7M OTT subscribers (all‑time high, +7.6% YoY; +370K OTT in Q4), 17.6M total U.S. subscribers (+170K in Q4), Q4 revenue of $323M (sequential +60 bps), Q4 adjusted OIBDA $56M, net debt $589M, gross debt $625M (including $325M 5.5% notes and $300M term loan), cash $36M and a $150M revolver undrawn.Starz Entertainment Corp Financial Statement Overview
Summary
Financials are pressured by a sharp TTM revenue decline (-25.1%), ongoing net losses (net margin ~-7.1%), and negative operating/free cash flow (OCF ~-$46M; FCF ~-$66M). The balance sheet is improved versus prior stress (positive equity; debt-to-equity ~0.95), but weak returns (ROE ~-28%) and persistent cash burn keep the financial profile below average.Income Statement
TTM (Trailing-Twelve-Months) revenue fell sharply (-25.1%), signaling meaningful top-line pressure. Profitability is mixed: gross margin improved to ~41%, but the company remains unprofitable with a negative net margin (~-7.1%) and only modestly positive EBIT (~$12M). While losses are far smaller than in prior years (notably 2023–2024), the current trajectory is still challenged by declining revenue and continued net losses.36
Negative
Balance Sheet
Leverage looks more manageable in TTM (Trailing-Twelve-Months) with debt roughly in line with equity (debt-to-equity ~0.95) and positive equity (~$646M), a clear improvement versus earlier periods that showed very high leverage and even negative equity (2024). That said, returns remain weak with negative return on equity (about -28%), indicating the capital base is not currently earning a profit and the balance sheet improvement has not yet translated into shareholder returns.53
Neutral
Cash Flow
Cash generation is a key weakness: TTM (Trailing-Twelve-Months) operating cash flow is negative (~-$46M) and free cash flow is also negative (~-$66M), with free cash flow declining further (about -58% growth). The company’s losses are not being offset by strong cash conversion, and the pattern over multiple years shows frequent negative operating and free cash flow (with 2021 being a notable exception).28
Negative
| Breakdown | TTM | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.93B | 1.37B | 1.39B | 3.85B | 3.60B | 3.27B |
| Gross Profit | 936.90M | 496.20M | 537.90M | 1.35B | 1.31B | 1.40B |
| EBITDA | 1.07B | 630.80M | -98.00M | 141.20M | 1.73B | 1.49B |
| Net Income | -138.00M | -211.20M | -915.20M | -2.01B | -188.20M | -18.90M |
Balance Sheet | ||||||
| Total Assets | 1.91B | 2.17B | 7.09B | 7.43B | 8.99B | 8.31B |
| Cash, Cash Equivalents and Short-Term Investments | 35.70M | 17.80M | 357.70M | 300.00M | 384.60M | 528.70M |
| Total Debt | 613.30M | 1.09B | 3.46B | 4.25B | 4.31B | 3.50B |
| Total Liabilities | 1.27B | 1.41B | 7.28B | 6.30B | 5.99B | 5.29B |
| Stockholders Equity | 646.00M | 766.40M | -312.70M | 784.50M | 2.68B | 2.79B |
Cash Flow | ||||||
| Free Cash Flow | -66.10M | -63.60M | -152.20M | -472.60M | -920.30M | 29.40M |
| Operating Cash Flow | -45.60M | -46.00M | -131.80M | -438.30M | -725.80M | 64.40M |
| Investing Cash Flow | 114.67M | -99.20M | -24.80M | -42.50M | -80.50M | -31.10M |
| Financing Cash Flow | -47.52M | 126.00M | 132.00M | 428.10M | 664.30M | 173.00M |
Starz Entertainment Corp Risk Analysis
Starz Entertainment Corp disclosed 34 risk factors in its most recent earnings report. Starz Entertainment Corp 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
Starz Entertainment Corp Peers Comparison
UnderperformOutperform
Sector (60)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $1.20B | 14.58 | 26.17% | 0.47% | 2.52% | 10.02% | |
63 Neutral | $1.59B | 928.67 | 2.62% | ― | 5.70% | 97.88% | |
61 Neutral | $4.01B | 13.10 | 1.51% | ― | 24.54% | -119.75% | |
60 Neutral | $48.67B | 4.58 | -11.27% | 4.14% | 2.83% | -41.78% | |
52 Neutral | $208.09M | -2.36 | -19.80% | ― | -2.85% | 75.96% | |
44 Neutral | $574.69M | -1.27 | 35.45% | ― | 9.74% | 12.29% |
* Communication Services Sector Average
STRZ
Starz Entertainment Corp
12.40
1.97
18.89%
IDT
IDT
47.79
-2.51
-4.98%
ZD
Ziff Davis
42.35
0.53
1.27%
AMC
AMC Entertainment
1.03
-2.01
-66.12%
SPHR
Sphere Entertainment
112.88
80.79
251.76%
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.