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Sunday night, World Wrestling Entertainment Inc. (NYSE:WWE) hosted an action-packed WrestleMania XXVI. After looking in the rearview mirror of the company’s stock chart patterns, I noticed that the past 3 years, WWE’s stock price has risen in Q1.

Since closing out 2009, WWE shares have risen from $15.33 per share to today’s price level of $17.60. So far, that’s a 14.8% stock price rise in this year’s Q1, with an additional 8.2% annual dividend yield the company prides itself on issuing to its loyal shareholders.

Wrestlemania XXVI is WWE’s version of the NCAA Final Four. Last year, the big event generated $21 million in pay-per-view sales from 975,000 paid views, which was seen as better-than-expected given the higher premium price and recessionary environment at the time.

Lately, WWE has body slammed a few intriguing deals:

ConAgra (NYSE:CAG) announced an integrated promotional deal with WWE to stage the comeback of the Slim Jim an iconic brand slowed over the past year by a factory explosion that caused a production shortage. Last night, Slim Jim was a presenting sponsor of Wrestlemania XXVI.

This month, WWE created a new online store at their site for tickets to all of their live events in North America. This is a partnership with Ticketmaster, a subsidiary of Live Nation (NYSE:LYV).

In February, WWE moved its toy licenses from Jakks Pacific (NASDAQ:JAKK) to toy heavyweight, Mattel Inc (NASDAQ:MAT). Wrestling star Triple H unveiled WWE’s first line of Mattel action figures and accessories, with more scheduled to debut in the Fall of 2010.

According to Variety, WWE “retooled many of its events and created themes that aimed to help them stand out and appeal to WWE’s changing audience, which includes more women (around 36%) and kids under 18 years old (around 20%) now that its weekly TV shows are PG.”

With a sign of major improvement, WWE’s pay-per-view revenues are up 5% for the year. WWE generates 18% of its annual business from pay-per-view sales. The executives at WWE really stepped it up when they discovered in 2009 that WWE earned $11 million dollars less from pay-per-view sales than in 2008. WWE usually ranks behind Time Warner’s HBO (NYSE:TWX) and UFC in pay-per-view sales.

Michelle Wilson, EVP of WWE marketing, said “It’s crucial to continue to reinvent yourself. WWE fans will tell you right away if they like it or don’t like it and if it’s something they don’t want, we don’t do it again.”

This year, more people are sitting on the couch watching main events, which means WWE will continue to benefit from their strong pay-per-view model. Why pay for all the costs associated with attending the big event when you can watch it for a fraction of the price on your living room flat screen? Things should really heat up when they offer wrestling in 3D.

Disclosure: No positions in the companies mentioned.

Source: WWE Drop-Kicks the Competition