Filing Flows › Companies › Madison Square Garden Entertainment › Analysis traps
Madison Square Garden Entertainment (MSGE): analysis traps
Where its figures could mislead a reader, and what to check before taking them at face value · Data: Q1 FY27, to Sep 30, 2026, filed Nov 4, 2026; rules v1.1
Madison Square Garden Entertainment (MSGE): 1 rule of 10 triggered on the filings to Sep 30, 2026: stock compensation added back = no economic cost. 1 to review; 2 with insufficient data; 3 not applicable. Each is a question to verify, with the normal explanation that would produce the same figures.
Check these first
Stock compensation added back = no economic cost Triggered · severity medium · confidence high
Stock compensation was $32M, 3.1% of revenue, in FY26; buybacks were $25M (0.8× the SBC) and buybacks did not cover it. 'Adjusted' figures that add SBC back treat pay in shares as free; the cost is borne by every shareholder as dilution, or by the cash spent to buy the shares back.
Innocent reading: A young company paying in equity while it scales; intensity falls as revenue grows.
A precise DCF value = the true value To review · confidence high
The DCF's point value is 66.77 a share (price 77.76); 71% of it is the terminal value, a number about years no one has seen. Moving revenue growth (each year) by ±5 pts alone takes it from 54.46 to 81.22; across every method the research ran the range is -11 to 249. The value is a range; the decimals are not information.
Innocent reading: A stable, mature business with a narrow range of outcomes, where the point value is a fair summary.
Every rule
A01 FCF growth = the business improved Insufficient data
fewer than two fiscal years with operating cash flow and capital expenditure on file
A07 Stock compensation added back = no economic cost Triggered severity medium · confidence high
Stock compensation was $32M, 3.1% of revenue, in FY26; buybacks were $25M (0.8× the SBC) and buybacks did not cover it. 'Adjusted' figures that add SBC back treat pay in shares as free; the cost is borne by every shareholder as dilution, or by the cash spent to buy the shares back.
The figures and how they are read
| Fiscal year | FY26 |
| Stock compensation | $32M |
| Revenue | $1.1B |
| SBC / revenue | +3.1% |
| Buybacks | $25M |
| Buybacks / SBC | 0.8 |
| Diluted shares, year before | 48.3M shares |
| Diluted shares | 48.0M shares |
| Diluted shares: change | -0.7% |
SBC / revenue from the cash flow statement's add-back; the diluted weighted share count year over year; buybacks from the financing section
Source: FY26 (stock compensation, buybacks and the diluted share count, fiscal year)
What would explain it innocently
- A young company paying in equity while it scales; intensity falls as revenue grows
- Buybacks at prices below intrinsic value make up for the dilution over time
- A one-off grant (an acquisition, a founder award) rather than a steady level
What to look for in the filing
- The share count after the latest buybacks (the next 10-Q's cover)
- The price paid for the buybacks against the shares' value
- Unvested awards outstanding
What would show the trap does not apply
- The diluted share count falls over two years with buybacks at least equal to the stock compensation
- Stock compensation falls as a share of revenue in each of the next two years
Look again: next filing.
B02 Receivables growing = future cash is certain Not triggered confidence medium
Receivables grew 8% against revenue 37% in Q1 FY27; DSO 37 against a median of 33: collections are keeping pace with sales.
The figures and how they are read
| Quarter | Q1 FY27 |
| Revenue, year over year | +37.2% |
| Receivables, year over year | +8.2% |
| Quarter before | Q4 FY26 |
| Revenue y/y, quarter before | +75.9% |
| Receivables y/y, quarter before | +31.8% |
| Days sales outstanding | 37.2 |
| DSO, median of eight quarters | 33.0 |
| Receivables | $88M |
| Revenue | $217M |
receivables and revenue against the same quarter a year earlier; DSO = receivables / quarterly revenue × days, against the median of the eight quarters before
Source: Q1 FY27 (receivables and revenue) · Q1 FY26 (the same quarter a year earlier)
B08 Adjusted profit = economic profit Insufficient data
no reconciliation table read from the releases yet and fewer than three quarters with both an adjusted and a GAAP EPS
C02 Low net debt = no refinancing risk Not triggered confidence medium
$30M comes due within a year, 16.4× covered by cash and investments of $194M plus $305M of free cash flow.
The figures and how they are read
| Cash and investments | $194M |
| Debt | $533M |
| Net debt | $340M |
| Due within a year | $30M |
| Read from | the current portion of debt on the balance sheet |
| Free cash flow, twelve months | $305M |
| Cash plus free cash flow | $499M |
| Coverage of what is due | 16.4 |
| Due in the second year | — |
| Balance sheet date | 2026-09-30 |
due within a year from the maturity table (else the current portion of debt), against cash and investments plus free cash flow over the last twelve months (zero if negative); no credit lines assumed
Source: 2026-09-30 (debt maturities, cash and investments)
D03 EPS growth = profit growth Not applicable
a loss in one of the quarters: EPS growth has no meaning
E02 Low P/E at a cyclical peak = undervalued Not triggered confidence medium
Net income of $97M is not at a cyclical high against the last eight years (median $66M, best $144M): the P/E of 38.6× is on a normal year.
The figures and how they are read
| market value | $3.7B |
| net income ttm | $97M |
| pe ttm | 38.60 |
| net income median fy | $66M |
| pe mid cycle | 56.40 |
| net income peak fy | $144M |
| years | FY21 / -219.0; FY22 / -133.0; FY23 / 77.0; FY24 / 144.0; FY25 / 37.0; FY26 / 66.0 |
| down years in window | 1 |
P/E on the trailing twelve months' net income against the P/E on the median net income of the last eight fiscal years (a mid-cycle stand-in); 'at a peak' = this year's profit at or above 90% of the best year and at least 1.3× the median
Source: Q1 FY27 (net income, trailing twelve months)
E07 A precise DCF value = the true value To review confidence high
The DCF's point value is 66.77 a share (price 77.76); 71% of it is the terminal value, a number about years no one has seen. Moving revenue growth (each year) by ±5 pts alone takes it from 54.46 to 81.22; across every method the research ran the range is -11 to 249. The value is a range; the decimals are not information.
The figures and how they are read
| dcf value | 66.77 |
| price | 77.76 |
| terminal value share | +70.6% |
| swing by input | Revenue growth (each year) / ±5 pts / 54.46 / 81.22; Operating margin / ±3 pts / 53.49 / 80.04; WACC / ±1 pt / 56.96 / 80.38; Tax rate / ±5 pts / 61.61 / 71.92 |
| range all methods | -11.0; 249.34 |
the DCF's point value against the share of it that is the terminal value and the value at each input moved by one step (growth ±5 pts, WACC ±1 pt, margin ±3 pts …); the range across every method the research ran
Source: 2026-11-08 (valuation research)
What would explain it innocently
- A stable, mature business with a narrow range of outcomes, where the point value is a fair summary
- The inputs that matter most are themselves well known (a regulated return, a long contract)
What to look for in the filing
- Which input you believe differs from the research's and why
- What the price implies for growth (the reverse DCF on the fair-value page)
What would show the trap does not apply
- The DCF's value is robust to the terminal growth and discount rate (the range's low end is still above the price)
- The company's cash flows over the next three years track the DCF's early years
Look again: next filing.
J06 A bank's low P/E and high profit = safe Not applicable
not a bank
J08 A REIT's low net income = the dividend is unsafe Not applicable
not a REIT
What the statuses mean
Triggered: the filings show the pattern; read the normal explanations and the missing evidence before concluding anything. To review: one quarter or a weak signal; a reader's judgement, not a pattern. Not triggered: the pattern is absent on these figures. Insufficient data: the filings read so far do not hold what the rule needs; this is not a clean bill. Not applicable: the rule is not meant for this kind of company (a bank's working capital, a loss-making quarter's EPS growth). Out of date: the latest filing is more than fifteen months old.
Severity is what the pattern could mean for cash, value or solvency; confidence is how reliable the inputs and the reading are. The two are kept apart.
Record a view
A reader's judgement, grounds, what would change it and the next review; kept in the browser (needs JavaScript).
Every rule and the companies it triggers on → Madison Square Garden Entertainment: cash flow → Earnings quality score →
Each rule reads the company's own filings by a fixed formula and says what would explain the same figures innocently. A triggered rule is a question to verify, not a finding of manipulation, and not a view on the stock. Missing data is shown as missing, never as clear. Not investment advice.