Starz Entertainment Corp.

STRZ

$27.17

+0.93%

N/A+$0.25

Communication Services

Entertainment

NASDAQ

Active Trading

Starz Entertainment Corp. offers its premium, subscription-based video content to viewers throughout the United States and Canada. The company primarily focuses on ...

Fundamental Analysis of STRZ

Key Strengths

Premium, recurring subscription OTT business with STARZ-branded direct-to-consumer app distribution and partner channels

Strong gross margin profile (TTM gross margin ~69%), indicating commercial monetization capacity at the content/service level

Risk Factors

Sustained GAAP losses and weak profitability (net margin ~-34%, operating margin ~-17%) with deeply negative ROE/ROA

High leverage and financial flexibility risk (debt-to-equity ~2.26; very low current ratio ~0.25 and negative working capital)

Profitability

Net Margin-33.98%

Operating Margin-17.03%

Valuation

P/E Ratio-1.07x

Current Ratio0.25

Efficiency

ROE-82.08%

ROA-25.58%

Fundamental Analysis of STRZ

Starz Entertainment Corp. (NASDAQ: STRZ) is a premium subscription video/content provider operating primarily in the United States and Canada. The business model is centered on STARZ-branded OTT streaming delivered through the STARZ app and distribution partners, monetized through recurring subscription fees and related programming/rights arrangements. From a fundamentals perspective, the most striking feature in the provided TTM snapshot is profitability pressure and negative bottom-line performance: net profit margin is approximately -34% and operating margin is about -17%, with net income per share of -25.45. Returns are also deeply negative (ROE about -82% and ROA about -26%), indicating that either costs, amortization, restructuring/impairments, or both are currently outweighing revenue generation. Despite losses, the company shows relatively high gross margin (about 69%), suggesting that content monetization and pricing can be attractive at the gross level. However, EBITDA margin is positive (about 29%), which implies that cash operating performance (or EBITDA-level profitability) is materially better than the GAAP net income level—potentially due to non-cash charges, depreciation/amortization, and/or restructuring impacts flowing through below EBITDA. Liquidity and leverage metrics point to financial strain: the current ratio is very low (≈0.25), working capital is negative, and debt-to-equity is high (≈2.26). Leverage and coverage also look stressed: interest coverage is reported as negative in the TTM metrics provided, while debt-to-EBITDA-related valuation metrics imply that debt servicing and cash flow conversion remain key watch-items. Valuation signals are mixed. Price-to-sales is low (≈0.37) and enterprise value to sales is modest (≈0.85), but common earnings multiples (P/E) are not meaningful due to losses. Free cash flow yield and operating cash flow coverage appear unfavorable in TTM figures, consistent with ongoing investment, rights/content economics, or cash flow volatility. Overall, sentiment likely hinges on subscriber/retention trends and the cost discipline of programming and content obligations; if Starz can sustain subscriber value and improve conversion from EBITDA to net income/FCF, the investment case strengthens. Conversely, persistent losses plus high leverage and weak liquidity remain primary fundamental headwinds.

Key Strengths of STRZ

Premium, recurring subscription OTT business with STARZ-branded direct-to-consumer app distribution and partner channels
Strong gross margin profile (TTM gross margin ~69%), indicating commercial monetization capacity at the content/service level
Positive EBITDA margin (TTM EBITDA margin ~29%), suggesting operating cash economics can be supportive even when GAAP net income is pressured
Programming mix and original/content strategy supports differentiation and potential subscriber retention (qualitative positioning from provided descriptions)
Data/technology and digital infrastructure (including the STARZ app) can improve user experience, acquisition efficiency, and engagement

Risk Factors of STRZ

Sustained GAAP losses and weak profitability (net margin ~-34%, operating margin ~-17%) with deeply negative ROE/ROA
High leverage and financial flexibility risk (debt-to-equity ~2.26; very low current ratio ~0.25 and negative working capital)
Weak/negative coverage indicators in the provided TTM metrics (e.g., negative interest coverage as reported), increasing sensitivity to refinancing or cost inflation
Cash flow conversion risk: free cash flow/operating cash flow metrics appear unfavorable in the TTM snapshot, indicating reliance on timing and cash discipline
Content and programming obligations risk: restructuring/write-downs or contract changes can materially impact earnings and cash flows
Regulatory and legal/content risks inherent in media distribution and licensing relationships, including potential legal claims related to programming
Industry and macro risk: subscriber growth and advertising/streaming economics can be pressured by weaker consumer spending and competitive pricing

Market Cap vs Revenue & Earnings

Earnings

n/a

Revenue

n/a

Market cap

$456.17M

-1.1x

P/E Ratio

0.4x

P/S Ratio

Earnings & Revenue

Last Reportedn/a

Earnings per share (EPS)n/a

Gross Margin69.32%

Net Profit Margin-33.98%

Debt/Equity Ratio2.26

Profitability Bridge (Current vs YoY)

How gross, operating and net margins shifted versus last year.

Revenue / Net Income / FCF History (USD B)

Growth Signals of STRZ

Metric	Current	Previous	YoYYear-over-Year change: current quarter versus the same quarter last year.	QoQQuarter-over-Quarter change: current quarter versus the immediately previous quarter.	Signal
Revenue	—	—	—	—	Flat
Diluted EPS	—	—	—	—	Flat
Free Cash Flow	—	—	—	—	Flat

Profitability of STRZ

Metric	Current	Previous	YoYYear-over-Year change: current quarter versus the same quarter last year.	QoQQuarter-over-Quarter change: current quarter versus the immediately previous quarter.	Signal
Net Margin	—	-61.51%	—	—	Flat
Operating Margin	—	-57.00%	—	—	Flat
ROE	—	—	—	—	Flat

Financial Health of STRZ

Metric	Current	Previous	YoYYear-over-Year change: current quarter versus the same quarter last year.	QoQQuarter-over-Quarter change: current quarter versus the immediately previous quarter.	Signal
Current Ratio	—	0.253	—	—	Flat
Quick Ratio	—	0.253	—	—	Flat
Debt / Equity	—	2.263	—	—	Flat

Valuation of STRZ

Metric	Current	Previous	YoYYear-over-Year change: current quarter versus the same quarter last year.	QoQQuarter-over-Quarter change: current quarter versus the immediately previous quarter.	Signal
P/E	—	-0.64x	—	—	Flat
P/B	—	1.64x	—	—	Flat

Supply Chain of STRZ

RELATIONS

Upstream

Lionsgate Studios Corp.NYSE:LION Universal Pictures / NBCUniversal (Comcast Corp.)NASDAQ:CMCSA Sky Studios (Comcast Corp.)NASDAQ:CMCSA Amazon Web Services (Amazon.com Inc.)NASDAQ:AMZN Akamai Technologies Inc.NASDAQ:AKAM Fastly Inc.NYSE:FSLYSedin TechnologiesParrot AnalyticsSummit Entertainment (Lionsgate Studios)NYSE:LION Apple Inc. (App Store / tvOS platform)NASDAQ:AAPL Roku Inc.NASDAQ:ROKU

Downstream

Comcast Corp. (Xfinity)NASDAQ:CMCSA Charter Communications (Spectrum)NASDAQ:CHTRDirecTVDish Network Corp.NASDAQ:DISH Verizon Communications Inc. (Fios)NYSE:VZ Altice USA Inc. (Optimum)NYSE:ATUS YouTube TV (Alphabet Inc.)NASDAQ:GOOGL Hulu + Live TV (The Walt Disney Co.)NYSE:DIS Amazon Prime Video Channels (Amazon.com Inc.)NASDAQ:AMZN Apple TV Channels (Apple Inc.)NASDAQ:AAPLPhilo Inc.Bell Media Inc. (BCE Inc.)TSX:BCESling TV (Dish Network)NASDAQ:DISH

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Plutux is not an investment adviser. Market data and AI-generated analysis are for information and education only, not investment advice. Disclaimer