Key Takeaways
- • Benchmark reiterated a Buy rating with a $15.00 price target on Lionsgate Studios (NASDAQ: LION), implying 19% upside from the current trading price of $12.56, ahead of the company's fiscal Q4 2026 earnings release scheduled for Thursday after market close.
- • Lionsgate's film "Michael" has generated over $700 million in global box office revenue, ranking as the second-highest-grossing release of 2026 and returning to the #1 position at the U.S. box office last weekend.
- • Benchmark projects $424 million in EBITDA for fiscal 2028, representing the highest Wall Street estimate, while the company reported $437 million in trailing-twelve-month EBITDA despite current unprofitability (negative EPS of $1.12).
- • The stock has delivered an 86% gain over the past 12 months and currently trades near its 52-week high of $13.01, supported by window carryover from fiscal 2027 and a strong creative pipeline.
- • Benchmark views Lionsgate's business model as resilient to recession risk due to non-reliance on advertising revenue and assesses potential AI disruptions as neutral to positive despite a February market sell-off following ByteDance's Seedance 2.0 video model release.
Summary
Benchmark maintained its conviction in Lionsgate Studios ahead of the company's fiscal fourth-quarter 2026 earnings announcement, reiterating a Buy rating and $15.00 price target as the stock trades at $12.56. The rating represents confidence in both current operational performance and forward-looking financial trajectories, with the analyst maintaining its highest-on-Wall Street projection of $424 million in EBITDA for fiscal 2028—despite the company's current unprofitability with a negative EPS of $1.12.
The studio's theatrical performance has provided tangible support for the positive outlook. "Michael," a major Lionsgate release, has crossed the $700 million global box office threshold, securing the second-highest-grossing film position for 2026, and recently reclaimed the #1 spot at the U.S. box office. This commercial success underscores the strength of Lionsgate's creative slate and validates Benchmark's view of sustained momentum from both new theatrical releases and the company's library content assets.
From a risk perspective, Benchmark highlighted structural advantages insulating Lionsgate from macro headwinds. The company's business model does not depend on advertising revenue, reducing exposure to recessionary pressures that typically impact ad-supported media platforms. Additionally, while ByteDance's Seedance 2.0 video model triggered a brief market sell-off in February, Benchmark characterized potential AI disruptions as neutral to positive for the studio, suggesting the analyst sees technological change as either benign or accretive to shareholder value.
The analyst cited window carryover benefits from fiscal 2027 and a robust creative pipeline as primary drivers of its positive stance. The stock has appreciated 86% over the past 12 months, currently trading near its 52-week high of $13.01. While InvestingPro analysis suggests the stock may appear overvalued at current levels, Benchmark's reiterated conviction reflects confidence in earnings execution ahead of Thursday's earnings release.
The studio's theatrical performance has provided tangible support for the positive outlook. "Michael," a major Lionsgate release, has crossed the $700 million global box office threshold, securing the second-highest-grossing film position for 2026, and recently reclaimed the #1 spot at the U.S. box office. This commercial success underscores the strength of Lionsgate's creative slate and validates Benchmark's view of sustained momentum from both new theatrical releases and the company's library content assets.
From a risk perspective, Benchmark highlighted structural advantages insulating Lionsgate from macro headwinds. The company's business model does not depend on advertising revenue, reducing exposure to recessionary pressures that typically impact ad-supported media platforms. Additionally, while ByteDance's Seedance 2.0 video model triggered a brief market sell-off in February, Benchmark characterized potential AI disruptions as neutral to positive for the studio, suggesting the analyst sees technological change as either benign or accretive to shareholder value.
The analyst cited window carryover benefits from fiscal 2027 and a robust creative pipeline as primary drivers of its positive stance. The stock has appreciated 86% over the past 12 months, currently trading near its 52-week high of $13.01. While InvestingPro analysis suggests the stock may appear overvalued at current levels, Benchmark's reiterated conviction reflects confidence in earnings execution ahead of Thursday's earnings release.
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