The potential recession in the U.S. economy should have little impact on the entertainment industry and on music stocks. Music is the antidote to depression, anxiety, and daily stress. It is by far a top way to change our mood and become more positive and happier, especially when the current stock market conditions are far from ideal.
The three music stocks in this article can make you feel upbeat about the future of the companies. They will also hopefully create a pleasant atmosphere later in 2022 with their quarterly performances. You can chill out and be sure that you have invested in companies that turn music into the rhythm of making sales and generating profits.
Here are the three best music stocks to buy now:
|SIRI||Sirius XM Holdings Inc.||$6.49|
|RSVR||Reservoir Media, Inc.||$6.70|
Best Music Stocks: Sirius XM Holdings (SIRI)
Sirius XM Holdings (NASDAQ:SIRI), offers a satellite radio subscription service that you can enjoy on the road, on your smartphone, or with your smart speakers or smart TV at home. Shares of Sirius XM are down only 2% in 2022, showing strength. This strength has high odds to continue as the fundamentals are great.
The sales growth has a positive five-year trend. Additionally, profitability has been following this revenue trend. In 2021, net income surged 903.05% to $1.31 billion.
The first quarter (Q1) 2022 earnings report was not bad either. The firm reported earnings per share (EPS) GAAP of 8 cents, which was in-line with expectations, and revenue of $2.19 billion, a beat by $37.03 million.
Sirius XM Holdings has a nice record of beating EPS estimates in the past three out of four quarters, which shows momentum in profitability. The company generates solid free cash flows and the one-year target of $7.27 is not unrealistic, representing upside potential of 17%.
Apple (NASDAQ:AAPL) is not just a consumer electronics company. It has various services that generate revenue and make profits consistently. One of them is Apple Music. You can play over 90 million songs and 30,000 playlists. One thing is sure; you will never run out of music to listen to.
You can download your favorite tracks and play them offline and you can ask Siri to play music for you and choose from a variety of artists and moods. In 2022, AAPL stock is down nearly 20%. This is a great investment opportunity to buy shares of an iconic brand at a discount.
For Q2 2022, Apple reported a beat on EPS and on revenue. The EPS GAAP of $1.52 was a beat by 9 cents and revenue of $97.28 billion was a beat by $3.28 billion.
In three out of the past four quarters, Apple has delivered better than expected results. I consider AAPL stock a buy at any dip. The firm has exceptional fundamentals, solid sales, net income growth and is a free cash flow machine.
Best Music Stocks: Reservoir Media (RSVR)
Reservoir Media (NASDAQ:RSVR) is an independent music company representing “over 140,000 copyrights and 36,000 master recordings with titles dating as far back as 1900, and hundreds of #1 releases worldwide.”
Shares of Reservoir Media have lost approximately 17% year-to-date. However, there is a lot of momentum in this music stock that investors will like. In 2022, revenue grew 34.39% to $107.84 million and net income grew faster at a rate of 101.84% to $11.89 million.
The expectations for revenue growth are optimistic, with a 10.2% growth expectation for 2023 and 10.66% growth for 2024.
What is also very bullish is the expectation that the company will not only continue to be profitable, but will increase its profitability soon. EPS of 12 cents is expected for 2023 and EPS of 20 cents is expected for 2024. The firm went public back in Jul. 2021 via a special purpose acquisition company merger. Its financial performance is sound in its first year of trading on the Nasdaq exchange. The company generates positive free cash flow and net income growth is very strong. For the quarter ending on Mar. 31, 2022, the net income grew 313.93% to $8.9 million.
Analysts are bullish on RSVR stock, with a one-year target of $12.33, or an upside potential of 87%.
On the date of publication, Stavros Georgiadis, CFA did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.