Seeking Alpha

Analysis: World Wrestling Entertainment quite the jewel

  • Media analysts think that if Vince McMahon decides to sell off his controlling stake in World Wrestling Entertainment (WWE +0.1%) that a host of buyers would be waiting in the wings.
  • The "attractive" WWE franchise could be of interest to Comcast or Madison Square Garden with its streaming model just starting to take hold.
  • Shares of WWE got a push higher last week off a rumor that AMC Networks wanted to convince Vince to sell.
Comments (5)
  • idkmybffjill
    , contributor
    Comments (1555) | Send Message
     
    If that is the case, why did Comcast pass up its exclusive right to renew with WWE back in February? And if WWE content was so popular, why have their renegotiated TV contracts not been renewed yet? They were supposed to be re-signed by March 4th, but now the company doesn't think it will have a signed contract until end of April/early May. Obviously, TV networks aren't as desperate for WWE as McMahon thought....
    17 Mar, 10:05 AM Reply Like
  • Oren Nathan
    , contributor
    Comments (2) | Send Message
     
    Even though, I don't own any stocks of WWE right now, I do think it has a potential of growing even more with the new model of the WWE Network, however I see some obstacles ahead.

     

    First and foremost, the most important "Make or Break" obstacle is the upcoming WrestleMania, which is scheduled to be the first "ppv" on the new network, with the allure that once a 60$ ppv, is priced at 10$ (with a commitment to a 6 months period to the network). The concern in my eyes, is that the service wouldn't be able to hold all the viewers.

     

    Just imagine a collapse/crash in the servers during the main event or the Undertake VS Brock Lesnar match. The servers must perform at their best in order to maintain millions of viewers streaming the event live. It's not Netflix or any kind of a video on Demand service, it's a live broadcast and that's a major concern in my eyes.

     

    Another issue is the rumors of Vince McMahon/the McMahon family, selling their majority stock to a major conglomerate. Quite frankly, I don't see this as a good sign.

     

    First - I don't see Vince and any of the relevant members sell their controlling stake as the WWE (in the past WWF), is a family business for more than 50 years, going from the territories era to Hulk Hogan and Stone Cold Steve Austin, and the Success that is WrestleMania, I don't see them selling their vision.

     

    Second - Without Vince or any of the McMahon family at charge, this could mean the end of professional wrestling. Just remember back in the 90's when Ted Turner had WCW (which was very successful at the late 90's), the merger between Time Warner and AOL turned to be the final blow to the sinking WCW (which lost around 70 millions in 2000 alone), and once a great entertaining company was sold to the WWE in 2001 under the ridiculous price of 4 million dollars.

     

    In conclusion,

     

    I Might buy some WWE stocks, but only after WrestleMania, only when I know for sure that the servers can hold a live streaming PPV in HD.

     

    Thanks.

     

    Oren.

     

    17 Mar, 11:35 AM Reply Like
  • mrmrmrj
    , contributor
    Comments (9) | Send Message
     
    Take a look at the 10 year chart to put the current move in perspective. Has anything changed about professional wrestling's popularity to warrant such a parabolic move that shatter old highs? No. Is WWE trying to improve its monetization of the sport? Yes. Still, there is a lot of room for disappointment now and probably only $10 more upside. This stock was dismissed at $10, $15 and even $20. Now all of a sudden there are articles popping up at many investment sites singing its praises.

     

    Beware.
    17 Mar, 01:41 PM Reply Like
  • Hopeful17
    , contributor
    Comments (61) | Send Message
     
    Is this a stock to short?
    17 Mar, 02:47 PM Reply Like
  • Jacob Steinberg
    , contributor
    Comments (814) | Send Message
     
    Vince McMahon would NEVER sell WWE, that's like selling your own baby.
    18 Mar, 06:50 PM Reply Like
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