Vivid Seats is priced for a slowdown while live events heat up

The fear in retail hides a boom in experiences

Headlines say the consumer is tired. Confidence sits near a cycle low and shoppers cut back on goods. Yet the experience economy is doing the opposite. Stadium calendars fill. New 2026 tours from top artists sell out at once. Primary sellers get swamped and overflow demand hits the secondary market. At the same time the US government is taking Live Nation and Ticketmaster to court with a trial set for March 2026. If the legal process loosens old constraints the ticketing market becomes more open and more competitive.

This is the setup for Vivid Seats. The market prices the stock for a weak cycle. On the ground the buyer still wants live shows. We think the gap between narrative and reality is wide. That is why this is interesting now.

We initiate at Strong Buy with a $71 PT

We initiate Vivid Seats at Strong Buy with a 12 month PT of $71. Our view is simple. The platform can stabilise then improve its economics while the market prices a trough as the new normal. A re rating is possible because the drivers that matter are visible and testable in the next 12 months. Our work points to revenue of $615mn in FY25E and $640mn in FY26E with improving margins. We see material upside if take rate lifts as seller tools and distribution ramp and if marketing return normalises from a difficult base. From a share price near $13 this implies roughly 432% upside to our PT if our thesis plays out.

We believe this call is contrarian for a good reason. Sentiment is very weak. We see that as opportunity rather than a warning because we can point to specific levers that change the maths.

What the market is missing about SEAT

The market treats demand for tickets like demand for shoes. That is the miss. Consumers may delay goods yet they still pay for great experiences. We see this in the pace of tour announcements and in persistent sell outs. This supports a steady flow of orders through secondary marketplaces.

We also think the market underweights Vivid Seats’ structural tools. SkyBox is embedded inside professional seller workflows. Vegas.com adds cross sell into travel adjacent buyers and better access to premium events. The United Airlines partnership increases distribution reach at moments of high intent. A strong loyalty programme raises repeat rates and the average revenue per buyer. Together these tools lift take rate and reduce reliance on expensive paid channels. That gives the company a credible path to better unit economics even if headline demand moves around.

The legal backdrop is a quiet tailwind. The Department of Justice case against Live Nation and Ticketmaster heads to trial in March 2026. A more open market would improve inventory flow and cut friction for alternative marketplaces. We do not model legal outcomes. We note the asymmetry. Any shift toward more competition adds optionality that the current valuation does not credit.

How we value SEAT and why this fits a marketplace

We value Vivid Seats on forward EV Sales applied to FY26E revenue. We choose this method because two sided marketplaces often show noisy accounting below the gross profit line and capital needs normalise as the model scales. EV Sales tracks platform scale and monetisation cleanly. It also avoids short term noise in working capital and stock based compensation.

Our peer set is marketplace and ticketing names with comparable take rate and monetisation levers. The group trades near 1.3x forward EV Sales. We apply 1.1x to FY26E revenue of $640mn. We take a discount to reflect working capital intensity and slower cash conversion vs some peers. We set a premium to Vivid Seats’ trough near 0.6x because we see durable demand on the platform, positive adjusted EBITDA of $83mn in H1 and net leverage below 1x which lowers solvency risk. On our base case this gives a PT of $71.

This multiple is not fixed. The two swing factors are FY26E revenue and cash conversion. If the platform fails to restore growth or if working capital stays heavy we would cut the multiple and review the rating. If take rate lifts and cash conversion improves toward peers we would expect the stock to move closer to the peer median.

Our forecast in plain view

We start from an improving profit base. Adjusted EBITDA in 2024 was $151.4mn. We model $165mn in FY25E and $185mn in FY26E. That implies margin expansion to roughly 27% in FY25E and close to 29% in FY26E. The driver is operating leverage as revenue recovers and as seller fees, cross sell and automation reduce unit costs.

We forecast revenue of $615mn in FY25E and $640mn in FY26E. The step up comes from H2 seasonality, better marketing efficiency after a tough stretch, Vegas.com cross sell and early monetisation of SkyBox Drive. We also include incremental distribution gains from the United Airlines tie up and the loyalty programme. These routes do not rely on aggressive paid acquisition which helps margins and cash.

The levers behind the recovery

Marketplace take rate is the engine. Management links Marketplace revenue to take rate and the company now has clear ways to raise it. A large share of pro sellers already use SkyBox to run their day to day. Turning on seller fees for workflow tools can lift fee capture without pushing buyers away. Vegas.com should add higher value events and a more premium mix which supports better yield. The United relationship can improve conversion and buyer value in travel windows. Loyalty and product changes raise wallet share among repeats.

We model take rate rising by about 100 bps from FY24 to FY26. That is the core reason our revenue forecast sits above some Street numbers. Early automation inside SkyBox Drive also reduces seller friction and increases listing speed which raises liquidity and supports better pricing.

Marketing is a second lever. The company faced a difficult period in paid channels. We think that normalises. As organic and partnership channels contribute more, the return on ad spend improves and payback shortens. That helps both growth and free cash flow.

KPI checkpoints and what success looks like

Orders are our main volume input. Marketplace orders reached 11.556mn in 2024. We model 12.25mn in FY25 and 13.23mn in FY26. That assumes a steady rebuild in H2 and growing seller activity as SkyBox tools deepen. Order growth matters because it spreads fixed platform costs and lifts margins even if prices move little.

We expect Marketplace GOV to stabilise then grow with $4.05bn in FY25E and $4.40bn in FY26E. Revenue grows faster than GOV on our take rate view. Marketplace contribution margin also improves with our model at about $303mn in FY25E and $349mn in FY26E. Management uses this metric to allocate capital which makes it a useful proof point for investors.

One more signal is what we call population growth delta. Management filings point to 6.7% for FY25E and 15.1% for FY26E. We treat this as evidence that platform participation is set to accelerate. Higher population growth raises liquidity, supports higher take rate and lifts revenue per buyer. If this step up happens, our re rating case gains strength.

Catalysts into 2026

Near term the story is execution. We expect visible progress on SkyBox Drive monetisation, clearer cross sell from Vegas.com and early results from the United distribution channel. We also expect the H2 calendar to help orders and GOV. Any sign that paid marketing payback improves will support the margin line and the multiple.

Looking a bit further the Live Nation case in 2026 could reshape market structure. A more open system would be helpful for an agile marketplace that already serves both buyers and professional sellers. We do not rely on a legal win. We note that the risk reward around that event skews positive for Vivid Seats while the current valuation assigns little value to it.

Where we could be wrong

We could be early or wrong on the core. If secular headwinds are real and buyers stop using secondary channels, our model breaks. If competitors build lasting moats or if Vivid Seats loses share faster than we expect, the take rate and order outlook will not hold. Pricing power could erode if take rates fall or cancellations rise. Execution could slip if product and seller platform work does not land on time.

There is timing risk as well. Metrics can take several quarters to normalise. Sentiment can stay weak or get worse. Multiples could compress before they rise which would hurt near term returns. In a stress case liquidity could tighten and force dilutive funding.

We watch specific fail points. Persistent y y declines in GOV and revenue would hit our base case. Sustained share loss, a clear and lasting margin step down or failure to reduce cash burn would also push us to change the call. There is also a regulatory angle. New rules on AI use and cross border data transfers could slow SkyBox monetisation or add cost if localisation is needed. That would weigh on FY26E revenue and cash conversion which are the two main levers in our valuation.

Bottom line

The market prices Vivid Seats for a slow fade while live events and platform levers point to stabilisation and better economics. We value the business on 1.1x FY26E EV Sales with $640mn revenue and reach a $71 PT. The upside is large if take rate and cash conversion improve as tools and distribution scale. The downside looks limited by positive adjusted EBITDA, low net leverage and clear catalysts we can track.

We initiate at Strong Buy. This is not a comfortable call. That is the point. The gap between price and our base case is wide, the checkpoints are measurable and the industry backdrop is improving. If we are right, the re rating can be powerful. If we are wrong, the current trough multiple already reflects much of the fear.