Mislabeling- the Real Ingredients in Live Nation’s (LYV) Cash Line

A casual glance at the cash balance leaves investors with the wrong impression

Many investors rely heavily on quantitative screening to quickly assess a company’s financial position and earnings. While screening may be helpful for whittling down the list of the thousands of public companies investors have to choose from to a more manageable roster, we always caution that investors must realize the potential pitfalls involved in the practice.

Recently, while working on a report on Live Nation Entertainment (LYV) for our intuitional clients, we came across a good example of the potential for financial ratio screens based on headline financial statement numbers to mislead investors who rely too heavily on the practice. We will take a closer look at LYV’s balance sheet and how the trail through the footnotes that investors must follow to get a clear picture of the company’s real financial position. (Note this report is not intended to express a negative opinion on LYV and does not represent a complete assessment of the company’s overall earnings quality.)

(Please contact behindthenumbers@btnresearch.com for questions regarding our institutional research service.)