Why StubHub Stock Plummeted by 13% This Week
A new law passed in Washington, D.C. imposes price caps on resold event tickets.
Overview
StubHub Holdings (NYSE: STUB) took a drubbing over the past few days, due to a new law in a major metropolitan market that could ding the ticket company's business. Investors didn't like the sound of that, and many reacted by selling their shares. This resulted in a 13% dive over the week for StubHub's stock, according to data compiled by S&P Global Market Intelligence.
On Tuesday, the Washington, D.C. City Council passed the RESALE Act into law. The measure, whose name stands for "restricting egregious scalping against live entertainment," imposes a 10% cap on secondary-ticket sale markups. That's quite the curb on StubHub's local business, as it relies on hefty markups for profitability.
Details
The law takes effect on Jan. 1, 2027.
Source
Originally published at www.fool.com.