Universal Music Group Stock Dips Almost 9% Following Pershing Square Share Sale

The music industry has built a reputation for being resilient during economic downturns. Even in challenging financial times, consumers continue to invest in music subscription services and attend concerts. While some synchronizing opportunities might diminish as advertisers tighten their budgets, the music business remains a robust sector that typically does not conform to standard economic trends.

However, music industry stocks are not spared from market volatility and the concerns of investors regarding the waning stability of the economy. This week, only three out of the 20 companies listed on the Billboard Global Music Index (BGMI) saw an increase, while five stocks experienced a drop of over 10%. Despite several strong quarterly earnings announcements in recent times, President Donald Trump’s tariffs on imports from Canada, Mexico, China, and Europe have triggered market anxiety, resulting in declines for music stocks alongside those of industrial and agricultural firms most likely impacted.

The S&P 500 entered a correction phase on Thursday (March 13), finishing 10% lower than its all-time high. The Russell 2000, representing small businesses, fell by 18.4% from its peak. Most stocks saw an upturn on Friday (March 14) as the markets rebounded — in spite of a decrease in the University of Michigan’s consumer confidence index — but the losses from the earlier days of the week proved too great to reverse. The S&P 500 concluded the week down 2.3% and the Nasdaq composite wrapped up down 2.4%.

International markets performed better than those in the U.S. The FTSE 100 in the U.K. slipped just 0.5%. South Korea’s KOSPI composite index saw a small rise of 0.1%, while China’s SSE Composite Index climbed by 1.4%.

Despite 17 out of the 20 companies on the BGMI experiencing losses this week, the index increased by 0.5% to 2,460.71, thanks to Spotify’s 8.1% gain, while the dollar’s nearly 1% rise against the euro helped to mitigate the weekly downturns of 17 other stocks. Spotify, the largest component of the BGMI with a market capitalization of about $117 billion — more than double Universal Music Group’s (UMG’s) $50.2 billion — also received positive news this week when Redburn Atlantic started coverage with a $545 price target, indicating a 5.5% potential upside from Friday’s closing price, alongside a neutral rating.

UMG shares declined by 8.8% on Friday, reacting to Pershing Square’s announcement on Thursday regarding the sale of 50 million shares valued at approximately $1.5 billion. Pershing Square CEO Bill Ackman referred to UMG as “one of the premier businesses we have ever owned.” JP Morgan analyst Daniel Kerven acknowledged that this news was “a short-term negative for confidence” in UMG yet viewed Pershing Square’s decision to sell shares as a strategy to realize profit and adjust its portfolio (with UMG making up 27% of its holdings) rather than as a commentary on UMG’s long-term outlook or recent operational results. UMG shares closed the week down 8.2% at 25.46 euros ($27.78) but still showed an increase of 6.5% year to date.

Live Nation shares fell 6.5% to $119.22, marking the fourth consecutive week of decline for the stock. Throughout the week, Deutsche Bank raised its price target for Live Nation to $170 from $150 while maintaining a “buy” rating. On Friday, a judge rejected Live Nation’s motion to dismiss allegations that the promoter unlawfully compelled artists to use its promotional services to perform in its venues.

Other U.S.-based live entertainment firms also suffered significant declines. Sphere Entertainment Co. decreased by 10.1% to $31.55. MSG Entertainment fell 1.3% to $31.46, even after Wolfe Research upgraded the stock to “outperform” from “peer perform” with a price target of $46. Vivid Seats, a secondary ticket marketplace, plummeted by 28.1% to $2.86 following the release of its fourth-quarter earnings.

Radio companies, which often experience setbacks when economic uncertainty leads advertisers to reduce spending, faced yet another difficult week. iHeartMedia fell 12.0% to $1.61, Cumulus Media dropped 11.5% to $0.46, and SiriusXM, which announced layoffs this week, fell 10.1% to $22.67. Year-to-date, iHeartMedia has decreased by 24.4%, while Cumulus Media has fallen by 40.3%. Conversely, SiriusXM has gained 1.4% in 2025.

K-pop stocks also experienced steep declines, despite South Korea’s market ending the week on a slight upswing. HYBE, SM Entertainment, JYP Entertainment, and YG Entertainment averaged a 7.4% drop for the week. Collectively, however, the four South Korean companies had a strong start to 2025, boasting an average year-to-date increase of 19.3% after this week.

• Source: NEWHD MEDIA