Just How Strong Is Live Nation's Concert Business?

Albert Fried & Company said Live Nation Entertainment, Inc. (NYSE: LYV) shares are extremely attractive as it benefits from the "demand by recording companies and artists to go on tour as a solution to thwart illegal P2P file sharing revenue losses."

The company reported first quarter loss of $(0.29) versus estimate of $(0.31). Sales of $1.208 billion also topped Street estimate of $1.18 billion.

Analyst Rich Tullo noted that revenue of $1.2 billion beat his $1.154 billion estimate, and concert ticket sales up 10 percent to $9 million also exceeded his $8.5 million estimate.

"As we get into the Summer Concert season LYV shares are from a seasonal POV extremely attractive as we expect strong Y/Y growth in 2Q and 3Q," Tullo wrote in a note.

The analyst attributed better-than-expected concert tickets sales to the preference of Millennial to spend on experiences, less adverse exchange rates and international growth.

Tullo also raised his 2016 revenue estimate to $7.35 billion from $7.28 billion and increased its adjusted operating cash flow forecast to $668 million from $641 million.

"We also argue the live events LYV produces and tickets are defensible in a media eco-system transitioning from traditional to digital distribution," Tullo added.

Tullo reiterated his Overweight rating and $34 target price on the stock, which is up 3.55 percent to $22.46.