MeritValue

Sphere Entertainment Co.

SPHRdata completeness 88%8 fiscal years on file
The thesis, from the filings

Sphere Entertainment Co. earns about -3% on invested capital, but has diluted owners by 32% over 5 years — worth asking whether the growth reaches owners. The cash-flow models don't apply cleanly here — the ledger says why below.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$789.9M1$608.2M2$571.2M3$1.02B3$1.22B3
Net income−$148.2M4−$194.4M5$502.8M6−$200.6M6$33.4M6
Operating cash flow−$58.7M7$141.3M8$153.6M9−$19.7M9$243.3M9
Capital expenditure$456M10$756.7M10———
Free cash flow (derived)−$514.7M7−$615.4M8———
Total debt$1.7B11$995.5M12$2.41B13$2.76B13$1.52B14
Cash & equivalents$1.52B15$747.3M16$132M16$573.2M17$521.3M17
Diluted shares34.3M34.3M34.9M35.3M45.3M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$493.01
your share of equity
Profit it earned you last year
$7.37
Free cash flow it threw off
—
Debt you’d be carrying
$336.25

10 shares is a claim on $493.01 of net worth that earned you $7.37 last year, against $336.25 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
-3% avg · 5y
FY21 -5%FY22 -7%FY23 4%FY24 -6%FY25 1%

It earned an average -3% on invested capital over 5 years. Compare that to what it costs to fund the business.

seeing a moat in the numbers →
Management signal · capital allocation
+32% shares · 5y

Share count is up 32% over 5 years — owners have been diluted. Worth asking what they got for it. Total debt has fallen 11% — deleveraging.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0
DCF · Growth Exit 10Y
not applicable
3y-median FCF non-positive — growth-exit DCF not applicable (see EPV)
DCF · Growth Exit 5Y
not applicable
3y-median FCF non-positive — growth-exit DCF not applicable (see EPV)
Earnings Power Value
not applicable
normalized (5y-median) earnings non-positive — EPV undefined
Graham Number
$28.65
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

Sources — the receipts
  1. 10-K · period ending 2021-06-30 · accession 0001795250-22-000013 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-06-30 · accession 0001795250-24-000026 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-06-30 · accession 0001628280-26-007760 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-06-30 · accession 0001795250-23-000017 (NetIncomeLoss)
  5. 10-K · period ending 2022-06-30 · accession 0001795250-24-000026 (NetIncomeLoss)
  6. 10-K · period ending 2023-06-30 · accession 0001628280-26-007760 (NetIncomeLoss)
  7. 10-K · period ending 2021-06-30 · accession 0001795250-23-000017 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-06-30 · accession 0001795250-24-000026 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-06-30 · accession 0001628280-26-007760 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-06-30 · accession 0001795250-22-000013 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K · period ending 2021-06-30 · accession 0001795250-22-000013 (LongTermDebtNoncurrent)
  12. 10-K · period ending 2022-06-30 · accession 0001795250-23-000017 (LongTermDebtNoncurrent)
  13. 10-K · period ending 2023-06-30 · accession 0001795250-24-000026 (LongTermDebtNoncurrent)
  14. 10-K · period ending 2025-12-31 · accession 0001628280-26-007760 (LongTermDebtNoncurrent)
  15. 10-K · period ending 2021-06-30 · accession 0001795250-22-000013 (CashAndCashEquivalentsAtCarryingValue)
  16. 10-K · period ending 2022-06-30 · accession 0001795250-23-000017 (CashAndCashEquivalentsAtCarryingValue)
  17. 10-K · period ending 2024-06-30 · accession 0001628280-26-007760 (CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents)