Almost a year in the making, Liberty Media's new tracking stock — Liberty Entertainment — had a roller-coaster debut on the NASDAQ last Tuesday.
The stock, which trades under the symbol “LMDIA,” opened at $26 per share, rising to a peak of $26.54 each and a trough of $24.49 per share before settling down to $25 per share in 4 p.m. trading March 4.
The stock rebounded on March 5, rising to $26.80 per share (up $1.80 each, or 7.2%).
Liberty Entertainment includes Liberty Media's 100% interest in premium network Starz Entertainment and its 41% interest in DirecTV Group, three regional sports networks and cable network GSN. On March 3, Liberty completed the tracker — which sprung from some assets formerly held within its Liberty Capital tracking stock — by reclassifying each Series A share of Liberty Capital as one share of reclassified Series A Liberty Capital and four shares of new Series A Liberty Entertainment common stock. Each share of Series B Liberty Capital was reclassified as one share of new Series B Liberty Capital and four shares of new Series B Liberty Entertainment.
DirecTV's strong fourth-quarter performance no doubt had at least some effect on the rise in the shares. DirecTV reported a gain of 275,000 net new subscribers in the fourth quarter, well outpacing No. 2 satellite-TV provider Dish Network, which reported a gain of about 85,000 net new customers in the period.
Liberty Capital now includes Starz Media, the production and distribution arm of Starz Entertainment, Major League Baseball's Atlanta Braves and Liberty's minority holdings in Time Warner Inc. and Sprint Nextel.
Liberty Capital saw its shares decline slightly to $17.48 per share (down 2 cents each) on March 5.
Liberty's third tracking stock — Liberty Interactive, which includes QVC, Provide Commerce and Backcountry.com — rose 14 cents each to $15.18 per share on March 5.
Liberty Media had announced its intention to create the Liberty Entertainment tracker in August. The company was waiting for the closing of its acquisition of the DirecTV interest from News Corp. — completed Feb. 28 — before issuing the tracking stock.