Despite the success of ticket sales for American singer Taylor Swift’s concerts in Brazil, which began last weekend in Rio de Janeiro, T4F (SHOW3) or Time For Fun common shares fell 9.65% (R $2.06). (20). The withdrawal was largely due to the controversy surrounding the events.
On Friday (17), the day the first concert of the tour took place in RJ, a 23yearold fan fell ill at the concert hall, Nilton Santos Stadium, and later died of cardiovascular arrest.
There were numerous comments on social media blaming T4F for the tragedy, claiming the organizer failed to provide water in an environment with a temperature of more than 60°C. In addition, fans who attended the show also reported problems organizing the event, confusion in the queues and poor structure.
Following the criticism, T4F changed its stance and said it would allow access to plastic bottles as well as sealed water glasses at upcoming events. The company also said it will provide free water in queues and at all entrances and entrances to the stadium and inside.
On Saturday (18th) authorities at all levels of government asked for clarification. Rio Governor Claudio Castro (PLRJ) said civil police would investigate the case, while Justice Minister Flavio Dino ordered the National Consumer Secretariat (Senacon) to take immediate action.
Following the problems, the singer’s show scheduled for Saturday was postponed until this Monday as there were already thousands of people in the stadium causing even more anger and negative comments. T4F opened up the possibility of a refund for fans who were going to attend the show on Saturday and are unable to attend today.
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“The value of a company is determined by the amount of free cash flow it is expected to generate over the life of the company,” explains Felipe Pontes, cofounder and equity specialist at L4 Capital.
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“Issues like this weekend present several uncertainties regarding the free cash flows the company can generate. They may trigger lawsuits against T4F, potentially resulting in losses and less money coming in in the future,” he adds.
In addition, the expert also emphasizes negative effects on the company’s brand.
“Events can lead to distrust among customers and business partners about the company’s ability to host major events in the future. This in turn would generate less cash flow,” he explains.
Taylor Swift’s show came at a not very positive time for T4F, as the company struggled to regain relevance after successive problems.
At the beginning of September last year, the company’s shares were hit by the suspension of singer Justin Bieber’s performances. At the end of March this year, more negative news: T4F was no longer responsible for Lollapalooza Brasil, which was broadcast to “Rock World”.
“In the short term, there were two significant losses for the company that exceeded the sales forecast,” emphasized Luiz Souza, variable income broker at SVN Investimentos at the time.
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“What’s left [o mercado] More exciting is the possibility that T4F will receive relevant contracts again, as the company has recently suffered greatly from the loss of Lolla and the cancellations of Justin Bieber’s shows. “In some ways it gives the impression that the company can maintain the contracts,” Danielle Lopes, partner and equity analyst at Nord Research, said at the same time.