December 24, 2012
Welcome to another edition of The Wrestling Post. This edition we’ll take a look at THQ’s bankruptcy, the Survivor Series buy rate and Daniel Bryan makes a young boy’s dream come true.
THQ goes bankrupt
The Wrestling Post takes a look at THQ’s Chapter 11 Bankruptcy filing and what that means for the WWE. According to court filings, the WWE is an unsecured creditor that is owed $45 million.
The video game maker had been accumulating losses over the past couple years which caused the company to file a Chapter 11 reorganization plan.
The WWE sent out a statement this past Wednesday which likely was sent out to ease the minds of its investors. It indicated in a short press release that it anticipated “actively participating” in the bankruptcy proceeding.
The WWE is listed as an “unsecured” creditor in THQ’s bankruptcy filing indicating that the company owes the WWE $45 million which reflects the entirety of its multi-year agreement with THQ.
The WWE indicated in another press release on Thursday that the amount owed by THQ would not impact the financials of the company. It went on to state that even if the $45 million debt would have an impact on the financials it would not affect its stock price.
THQ will not cease operations as it is in the process of being purchased which means that THQ may still have an existing contract to make the WWE video game franchise. The bankruptcy court would have to allow the purchase to go through.
Payout Take: Being an unsecured creditor in this type of bankruptcy proceeding means that its highly unlikely that the WWE would recoup any of its $45 million from THQ. Although it indicated that it would actively participate in the bankruptcy proceedings it may be more saber rattling than having a good chance of collecting on the debt. The press releases were investor relations PR to ease the minds of its stockholders. Losing $45 million is not a good thing for the company and letting investors know it wouldn’t affect its financials seems more important than actually recouping the debt. Although, both would be nice if you were Vince McMahon.
Survivor Series buy rate disappointing
The Wrestling Observer (subscription required) reports that the Survivor Series buy rate received only 212,000 buys. In comparison, last year’s Survivor Series did 281,000 buys. Of course, the main event featured The Rock and John Cena. But, the year before, the 2010 Survivor Series received 244,000 buys for a Randy Ortron-Wade Barrett PPV.
(h/t Cageside Seats)
Payout Take: Poor ratings for what used to be the biggest event of the fall for the WWE. A CM Punk-John Cena-Ryback main event failed to draw enough interest from fans. It will be interesting to see what the WWE will do to create more interest for its PPV buyers considering the vast amount of WWE content via many platforms.
Bryan taps for a good cause
On a recent stop in Pittsburgh by the WWE, wrestler Daniel Bryan made a pre-show visit with a young fan with cancer. The highlight of the visit was the young boy putting Bryan in a submission hold and Bryan tapping. (via CBS Local Pittsburgh)
Payout Take: Despite some of its questionable storylines, the WWE recognizes its obligation to charity including the Make A Wish Foundation. John Cena has made many appearances with young children with terminal diseases. While the appearance by Bryan is good publicity for the company, it also fulfilled the dream of a young boy. A very good story for the holiday season.
December 15, 2012
Welcome to another edition of The Wrestling Post. This week we look at TNA’s venture into lottery tickets, reduction in PPVS and the WWE’s iPad App.
TNA agrees to pact with lottery ticket maker
MDI Entertainment, LLC has signed a deal with TNA wrestling for lottery branded scratch tickets with images of TNA stars. The agreement includes images on promo materials as well as the possibility of personal appearances and public service announcements. The agreement includes the possibility of second chance prizes including the possibility of TNA merchandise and/or trips to TNA events.
(H/t: Cageside Seats)
Payout Take: A good partnership for both companies as it allows some promotion of the TNA brand and it gives the company some exposure to a greater population of people.
WWE’s iPad App offers second screen experience and PPVs
Last week, the WWE began promoting a second screen experience entitled “WWE Active” which allows users of the App access to additional information including polls, trivia and the opportunity to watch backstage features during the live edition of RAW. In addition, the WWE announced that users could eventually order PPVs on the App which would allow mobile access to watch WWE PPVs
Payout Take: The WWE iPad App is very popular with 2.7 million downloads in 215 countries. Having used the app, it definitely is one of the better free downloads for iPad users. The move to utilize the app to include additional original content allows more interaction with its fans. The PPV component is one way to monetize the app and give fans another way to access the WWE.
TNA reduces PPV schedule
The Wrestling Observer (subscription required) reported that TNA Wrestling will be reducing its total PPVs for 2013 from 12 to 10. This would allow for better buildup between pay per views.
Payout Take: Less is more. This is a good move by the company as it can build on storylines and hype the matches for a PPV. The move should help with overall PPV sales for the year and shave down production costs for two less PPVs.
November 22, 2012
Welcome to another edition of The Wrestling Post. This week we look at the WWE calling out TUF, a new distribution deal for the WWE and CM Punk not happy with management.
WWE makes another run at the UFC
During this week’s Monday Night Raw, the WWE took a shot at the low ratings of TUF. In one of its intro bumpers it boasted that the WWE’s Friday Night Smackdown on SyFy was the most socially active show on broadcast and cable TV. The bumper went on to state that it beat The Ultimate Fighter “by 10 times!” (via MMA Fighting).
Payout Take: The implication is that the WWE has more viewers and a bigger fan base promoting the product via social media than the UFC. Yet, as the MMA Fighting article points out, neither company considers the other a direct competitor. Usually, the WWE touts (no pun intended) its company versus others in the marketplace. This past Monday, another one of its bumpers stated sales of the WWE’s game, WWE ’13, exceeded that of Madden and NBA2k13.
The interesting thing is that the UFC usually does not return fire at the WWE even though Dana White is known for responding to anything negative about the UFC.
WWE forges new international distribution deal
The WWE announced it has entered into an agreement with FremantleMedia Enterprises (FME) for the exclusive home entertainment rights to WWE’s catalogue of programming across Europe, Middle East and Africa. (EMEA).
According to the press release FME will manage the DVD, Blu-ray and digital rights for all new and existing WWE content, making it the first time that fans of WWE’s popular programming can access it digitally across EMEA.
Payout Take: The move should help with growth internationally and bolster the profits overseas. The digital media sector is lagging based on the 3rd Quarter results from the company so this move looks to assist with this issue.
CM Punk appears on The Talking Dead; gets to be Grand Marshal of parade
WWE Champ CM Punk will appear on AMC’s The Talking Dead, the shoulder programming for the network’s big hit, The Walking Dead. The interesting part of this is that Punk was critical of the WWE for not promoting his appearance this Sunday.
The WWE has promoted its talent on other programming. This past Monday, it promoted the WWE taking over the E! Networks “The Soup,” on Raw this past Monday but no mention of Punk’s appearance.
Payout Take: Whether or not Punk is in his bad guy character when he’s tweeted his disappointment for not promoting his appearance. It could be a part of his gimmick but I would think that the WWE would want to take advantage of any mainstream publicity it could especially since The Walking Dead is one of the more popular shows out there. Even if Punk would be on the talk show supporting TWD, it would be beneficial for the WWE. Overall, appearances by WWE characters on The Soup and The Talking Dead help the brand and its characters and reflect an emphasis on the Entertainment part of WWE.
November 1, 2012
The WWE announced its 3rd Quarter earnings on November 1st with mixed news as the company saw a decline in its profits and revenue from last year yet it beat analyst expectations. The big news from the earnings call is that the WWE has decided on a pay subscription model for its WWE Network.
The WWE net income for the third quarter of the year was $3.5 million and 5 cents a share whereas it earned $10.6 million and 14 cents a share in 2011. Thus, the net income was down 67%. The earnings for Q3 in 2012 would have been $5 million and 7 cents a share but for a one-time expense adjustment.
Revenue was down 4% from $108.5 million to $104.2 million this quarter.
Good news for the company was that average attendance in North America was up 6% and PPV buys saw an increase of 13% for 3 events in the quarter. This rise was anchored by Summerslam which was up 21%. This can be attributed in part to Brock Lesnar’s participation in this year’s Summerslam main event.
Notwithstanding the financials, the big news coming out was the WWE Network. The WWE produced research which indicates “a significant WWE U.S. fan base of 57 million households.” A detailed survey of over 9,000 households was conducted and the findings concluded that 50% of U.S. households can be considered a “WWE fan household.”
Last week, industry trade RBR.com reported on the study compiled by SNL Kagan which indicates that 20% of the 57 million are hardcore wrestling fans that follow the wrestlers, the storylines and regularly watch the WWE shows. A bigger subset of casual fans (40%) are not heavily invested in the program and while the research identified another subset of “lapsed fans.” These are individuals that used to watch wrestling and may be able to be attracted back to watching. I would contend that many of us are “lapsed fans” to some extent.
But, based on the research to support its choice, the WWE Network will be a premium subscription channel which will have some form of interactive component. McMahon indicated that the network would be an “add-on” to its complement of shows on cable and its PPVs although there is a possibility that PPVs may be included on the network.
As more news on the network continues to trickle out, it would be interesting to know what investors think of this investment. We can be skeptical of the SNL Kagan study like we may have been with the WWE’s economic impact report on host cities for Wrestlmania but there is a segment of the population that likes wrestling. The big question is how much? I am not sure that consumers would be willing to spend $10-$15 a month on one premium channel for wrestling. Certainly, this is the WWE’s challenge. I surmise that the WWE is hoping to utilize its vast wrestling library to conjure up some of the memories of the past to attract some of those lapsed fans while providing fresh content for its hardcore fans. The price point will be the big influencer on its success. Analyst Brad Safalow of PAA research believes that the premium model could pan out well for the company.
Via the LA Times:
“Subscribing to the network would be a ‘no brainer’ for the company’s hardcore fans,” (Brad) Safalow wrote in a recent report. Safalow said he anticipates a price of $14.95 for the channel and that WWE should be able to get 400,000 subscribers out of the gate and almost double that in two years. In 2014 Safalow projects that a pay channel could add as much as $141.6 million in revenue to WWE.
400K subscribers and $141.6 million in “add-on” revenue would perk the ears of investors but the questions remain as everyone waits for a launch date and more specifics.
October 29, 2012
Welcome to another edition of The Pro Wrestling Post. In this edition we look at a new show for the Miz, news on the WWE Network and a look at Linda McMahon’s political campaign
The Miz gets a role in ABC Family show
WWE Studios and ABC Family announced on Friday that an upcoming television movie, Christmas Bounty, will star Michael Mizanin (aka The Miz) in the main role.The movie is described as “an action-filled comedy about a former bounty hunter turned elementary schoolteacher looking for a normal life.” Its the latest of several movies that the former MTV Real World star has been in since turning his reality television persona into a pro wrestling star.
Payout Take: The latest partnership is an example of how the WWE is attempting to expand the “E” in Entertainment in its name. It also shows how the WWE can leverage its larger than life pro wrestling stars into movies and television roles.
WWE Network Launch still a mystery
In a leadup to its earnings call next week, the Hartford Courant interviewed WWE CFO George Barrios. The WWE promised more information at its Q3 earnings call on its WWE Network launch date which continues to be a moving target.
Barrios offered no new news on the network and it is still up in the air as to how it will be distributed.
Also in the article, the piece reports on the fact that the WWE has received nearly $37 million in state tax credits for TV production, digital media and infrastructure since 2007. It makes the WWE one of the largest beneficiaries of Connecticut’s economic aid. The state’s tax credit offers as much as 30% of the value of expenses incurred in Connecticut for media production firms. The speculation is that with the WWE Network, the company will hire more people. It has grown from 585 employees to 700 in the last 20 months according to Barrios in the article.
Payout Take: The tax credits have become political fodder for Linda McMahon’s senatorial campaign. The Hartford Courant did paint the WWE in a good light as a company that has used the state program correctly. Many opponents of the program point to carpetbagging Hollywood studios that would utilize the tax credits in state and then leave. As for the Network, the interview with Barrios offers nothing to look forward to with the earnings call this week.
Linda McMahon’s senate run tied to Trump
Earlier this week, the WWE and Linda McMahon’s senatorial campaign did some PR work after Donald Trump announced he was offering $5 million for the release of the President’s college transcripts and passport application. The issue was that $5 million was the amount that Vince and Linda McMahon’s Foundation gave to Trump’s Foundation in exchange for his appearances with the WWE several years ago. The problem is that Ms. McMahon is campaigning for senate in a race that has had its share of mudslinging. This issue could be perceived as advocating Trump and his extreme position on the President.
Payout Take: McMahon is serious about winning this race. She has spent $42.6 million to date and is nearing the $50 million she spent last go round. This includes a recent loan of $3.3 million of her own money. The Trump issue was an additional hurdle she had to address in a campaign where she has made attempts to parse out her association with the WWE to validate herself with voters. We shall see how she will do next week.
October 18, 2012
Welcome to another edition of The Pro Wrestling Post. This week we look at John Cena visiting the Jets, the WWE working with the Rolling Stones and Miami receiving over $100M in positive financial impact from this past spring’s Wrestlemania.
Patriot fan Cena acts as honorary captain at Jets game
John Cena, a Massachusetts native and New England Patriots fan, served as an honorary captain for NFL East rival the New York Jets this past Sunday. Cena was there to promote Wrestlemania 29 which will be held where the Jets play.
MMA fans recall that Frankie Edgar visited the Jets two years in a row and spoke to the team before the game.
Payout Take: A strange promotional pairing. Cena, who is legitimately recovering from an injury, got the nod as honorary captain because of his name recognition and it was a way for him to participate during Sunday’s game against the Colts.
WWE distributing Stones concert
The WWE announced that it will be distributing the Rolling Stones final PPV concert this year. Entitled “One More Shot,” it is the biggest foray into the new entertainment fields the WWE hopes to expand into the field of entertainment.
The WWE is working with media entertainment company Endemol and promoters Dainty Group to distribute the Rolling Stones’ concert. The WWE was sought out based on its handling of big PPVs such as its annual Wrestlemania events.
The concert will be the fourth and final concert from the Stones’ 50th anniversary concerts. It will be held on December 15th.
Payout Take: It will be interesting to see the execution of this event. The WWE will be announcing its 3rd Quarter results in November and we should here more of its plans for its entertainment division. The WWE is looking to monetize its production and distribution business and we shall see how aggressive it will be to seek out other opportunities.
Miami receives positive $100M economic impact from Wrestlemania 28
The WWE indicated in a press release this week that Wrestlemania 28 generated $102.7M in economic impact to the host city of Miami and Miami-Dade County. The impact, obtained from an economic study done by Enigma Research Corporation, represents a $40M increase from WM 27 in Atlanta.
Some interesting numbers from the WWE press release:
-$102.7 million of direct, indirect and induced impact derived from spending by
non-locals visiting specifically for WrestleMania XXVIII.
-71% of fans that attended WrestleMania were from outside the Miami area and stayed an average of four nights.
The economic impact derived from WrestleMania Week was equal to the creation of 1,020 full-time jobs for the area.
-$6.9 million was spent by non-locals at Miami and Miami-Dade County restaurants.
Payout Take Certainly we can poke holes in the economic impact study as there’s no indication whether it was commissioned by the WWE. Still, Wrestlemania is a big sports entertainment extravaganza and it has fans from all over flocking to the host city. Moreover, it has city tourism boards vying for the opportunity to be the next city to host. Even if the numbers are rounding up, one cannot deny that a host city, especially in this economy, would reap financial gain from hosting the event.
October 8, 2012
The Sports Business Journal and Figure Four Online examined the annual ESPN Poll which took a look at the popularity of Boxing, MMA and professional wrestling. The poll suggests that MMA is primed to take over the fight landscape.
The conclusion is that the UFC is primed to take over boxing and it is buoyed by its brand dominance.
The ESPN Poll is based on 5,146 interviews from January – July 2012.
Below are some interesting insights from Rich Luker, the founder of Luker on Trends and the ESPN Poll.
Almost half (48%) of Americans ages 12 and over are fans of one of the forms of fighting explored here: boxing, MMA and/or professional wrestling. 75% of the fight fans follow 2 or three types of fighting. 58% of fans describing themselves as “avid fans” have interest in two or three fighting forms.
Despite its Fox deal and appearing quarterly on network television, the poll reflects the fact that MMA has not surpassed boxing in terms of fans. Although MMA was ahead of boxing from 2007-2010 in terms of avid fans, boxing surpassed MMA in 2011.
Key Demo Numbers
The ESPN Poll points out there are several factors culled from the poll that reflect the fact that MMA is the fighting sport of the future.
Specifically, it is the 13th-largest general fan base and eighth-largest avid fan base, “which is remarkable at a time when it is hard for a new sport to emerge,” according to the SBJ.
Also, an average of 60.5% of those polled ages 12-54 are a fan of MMA and a little over 24% of fans ages 12-54 consider themselves avid fans of MMA.
Looking at the 2012 numbers, when asked if you had any interest in the sport, in the most important male 18-34 demographic MMA has a slight lead over boxing.
Boxing: M18-34 66.6%
MMA: M18-34 67.4%
Pro Wrestling: M18-34 35.6%
For women 18-34, MMA has a bigger lead over boxing.
Boxing: W18-34 41.2%
MMA: W18-34 44.0%
Pro Wrestling: W18-34 24.6%
One of the takeaways made by F4WOnline is that boxing and MMA get its fans to attend events, while pro wrestling (i.e., WWE) gets its fans to watch its weekly shows.
Would MMA dip like World Series of Poker?
Remember WSOP? The craze in which the unthinkable happened. People watched other people play poker.
The poker craze saw incredible ratings and then the ratings treated. The SBJ cites the fact of the lack of personal investment in the game, rather more an instructional video on how to play poker than interest in the sport. Personally, two more reasons hurt the sport. First, the investment in following a poker player was hard to do if a favorite such as Phil Hellmuth, is eliminated in the first day of the World Series of Poker. How does television produce around that? Secondly, the ban on online gambling negated interest since many casual people were willing to try on their computer but not in a casino to play. When legislation was passed to stop online gambling, many saw no reason to watch.
Women on the Rise
The article notes that women interest in MMA could be a key component to the future. The poll states that women’s interest in boxing from 2002-2012 is up for women. The avid interest in women ages 12-54 is stronger in MMA than older men 55 and older. The rise of women participating in boxing and MMA is cited as the reasons for the increased interest. This is the reason why we see Ronda Rousey at every UFC event and why she is the future of women’s MMA. It is also why we’ve seen the interest in InvictaFC.
Speaking with Fertitta
ESPN asked Lorenzo Fertitta about the UFC’s numbers being down over the past two years and Fertitta noted the fighter injuries, the switch to a new network and reestablishing its relationship with the fans on television.
Dave Meltzer offers his opinion on the poll via F4WOnline (subscription required and highly recommended):
My theory about the wrestling audience changing is that it has a super loyal audience, the same basic people; Raw has its audience, Smackdown has its audience. Impact has its audience. Every now and then, like if The Rock comes back and it’s advertised well, or Raw 1,000, or any kind of nostalgia theme, you can pick up the Raw audience. But they seem to have very little interest outside of their group. In the past, we used to joke about casual fans, who watch every now and then, but are aware of many if not all the big names. Pretty much any sports fan could tell you the names of the top wrestlers then who were active, but if you ask today, past John Cena, any names mentioned are going to be stars from another era. That’s the difference between Ric Flair showing up at an NHL game in 1989 (or even 2012) and people mobbing him, and C.M. Punk or the Miz doing so today , and nobody knowing who they are.
There are more people aware of boxing because it’s covered as a mainstream sport, but people don’t watch it weekly on television. They only care about two guys now, and in MMA, you have the mix.
An astute observation on the key audiences by Meltzer. And something that each of the sports would like to change. The WWE is criticized at times for not pushing certain talent while recycling older talent. But, it’s easier to sell HHH and the Undertaker more than CM Punk and Sheamus. This is true especially for the SummerSlams and Wrestlemanias. Its why Brock Lesnar or The Rock are much safer bet to main event these shows than a Dirk Ziggler or Daniel Bryan. But, the WWE has the necessary platforms to give one of its stars the necessary push. It still takes time for this to happen.
For as much as we’ve asked whether boxing is making a comeback, it appears that it made it back to overall popularity in 2011. Moreover, the numbers reflect that boxing has not really dropped in popularity.
The rise of women’s interest in the sport should resonate with MMA and MMA brands. Ronda Rousey is the face of women’s MMA and has been a good ambassador for the sport of women’s MMA. Rousey has a following of young women that follow her because of their interest in the MMA. If we have not seen it already, fight apparel and gear will take more a focus in marketing to women.
We shall see what the UFC can do to cultivate more stars for fans to follow. Interesting that Dana White has had run-ins with two of the organizations biggest stars: Anderson Silva and Jon Jones. Moreover, White threw Jones under the bus for UFC 151 before cooler heads prevailed. That’s not a way to promote a star.
September 26, 2012
Welcome to another edition of The Wrestling Post. We talk about Jerry Lawler’s new t-shirts, a new WWE partnership and the color Pink.
“Long Live the King” T-Shirts emerge after near tragedy
A week after a near tragedy on live television, WWE capitalized on the situation by selling Jerry Lawler T-shirts. Lawler suffered a heart attack at the announce table on Monday Night Raw. Fortunately, aid teams were on the spot and saved his life. Lawler was taken to the hospital and is now back home resting. He actually made an appearance on Raw this past week.
The WWE debuted new Lawler t-shirts on its web page. Michael Cole, Lawler’s announcing partner wore the shirt which read, “Long Live the King.” The shirt sells $25-30 according to the web site.
Payout Take: Is it poor taste for the WWE to take advantage of the situation or business savvy? If Lawler gets a portion of the shirt revenue, then I’m shirt the King is all for it. The WWE could have made a PR move here by announcing that portions of the shirt sales would be donated to charities assisting those with heart conditions (maybe tying in that sales go to “a Hart Foundation”).
WWE announces Hulu Plus Partnership
WWE announced a partnership with Hulu Plus which will allow fans to access WWE content the next day. Hulu Plus has more than 2 million paying subscribers who spend $7.99 a month to access its programming.
The multiyear deal allows subscribers of Hulu paid services the ability to watch WWE shows including “Monday Night Raw,” “Friday Night Smackdown,” “WWE Superstars,” and more. The partnership allows the WWE to monetize its library of programming online.
Payout Take: This deal allows the WWE to leverage its bulk of content for the internet. It gives the WWE another platform for its product and gets the WWE in front of “cord cutters,” individuals that have cancelled their television cable programming. It’s a good deal and shows that the WWE continues to embrace online users as its YouTube channel has been very successful.
WWE going Pink
The WWE announced a partnership with the Susan G. Komen for the Cure. John Cena will be wearing Pink branded gear which he will wear through the month of October. The WWE will donate 100 percent of its profits of sales of pink-branded gear to the breast cancer foundation.
Payout Take: Similar to what the NFL does in October, you will see Pink worn by the WWE’s most visible star. In addition, the WWE had pink ring ropes for Monday Night Raw. The foundation has made the color synonymous with its cause through its tie-ins with the NFL and now the WWE. It’s a noteworthy cause and this partnership should reach out to many women fans of the WWE.
September 14, 2012
It was a surreal Monday Night Raw from Montreal as Jerry “The King” Lawler suffered a heart attack while commentating a match. Emergency personnel on hand acted swiftly in getting Lawler the help he needed and saved his life.
Although it appears that Lawler will make a recovery, the WWE was faced with another decision of whether to continue with the live event. The irony of the situation is that Raw’s special guest was Bret Hart. The Hitman’s brother, Owen Hart, died in the ring at a WWE PPV in 1999. Hart fell from the rafters as he had an equipment malfunction. Despite the tragedy occurring, the WWE decided to continue on with the PPV. This decision was heavily criticized as it forced WWE performers to continue with the event despite seeing a friend and co-worker fall to their death right in front of them. Not to mention the fact that many fans attending the event saw this too.
Which brings us to this past Monday. Commentating was cut off during the matches from the time that Lawler was taken to the back. Commentator Michael Cole did inform the audience what had happened. Honestly, I had flipped channels and when I heard Cole’s announcement I did not know something actually happened. I thought it some part of the show even though Cole said it was not.
Payout Take: The WWE management was faced with the hard decision of continuing with the show or abruptly ending it while medics attended to Lawler. Despite the lesson of Owen Hart, WWE continued with its programming. It’s hard to say if this was the correct decision or not. Since Lawler ended up ok (relatively speaking), having updates and WWE programming on probably helped. In a morbid way, the social media buzz about Lawler probably gained viewers as many casual and non-casual viewers turned to the USA network to figure out what was going on. The third hour ratings were up from last week but down from its average.
If the show had gone off the air abruptly, I’m sure it would be understandable. But, it would leave many scrambling to twitter to find out what was happening. However, if something tragic were to have happened, the WWE would have been criticized for the continued airing of the event. Again, the WWE gambled that the real life emergency would not disrupt this meticulously scripted staged environment. Notably this time, the WWE held off from commentating and gave updates on Lawler’s condition. Essentially breaking with the script to report on Lawler.
The WWE has become much more aware as a company since 1999. Of course, becoming a publicly traded company probably had something to do with this. Still, the WWE continued with caution in continuing with its programming with the full knowledge of the possibilities and the likelihood that rumors on social media would be rampant.
On another note, Lawler’s heart attack brings up the issue of older wrestlers performing. While we all know its scripted, the physicality is still present and someone in their 50s and 60s needs to be monitored much more than the guys in their 20s. I’m sure the WWE will take a deeper look into this after this incident.
September 3, 2012
The WWE saw a bump in its stock price late last week after Richard Ingrassia of Roth Capital Partners upgraded its stock from a “Neutral” to a “Buy” and raised the stock price from $10 to $12. As a result, WWE’s stock saw an increase of 4 percent late last week.
The analyst cited a rise in non-Wrestlemania PPV buys, the creation of more content on cable television, it’s social media presence, the retooling of the WWE Film division and the inevitable WWE Network as reasons to upgrade the company’s stock.
The WWE ended last week up slightly at $8.88.
An interesting analyst analysis and the reasons for the positive upgrade are items that have been discussed in WWE earnings calls. However, most of these issues (e.g. WWE Films, WWE Network) have been seen as more of a burden than a benefit. For instance, Ingrassia projects that the WWE Network should add $68 million to the company in 2013. But, this assumes that the WWE is able to organize in time for the new year despite the fact that the WWE Network was to launch the day after Wrestlemania 28 this past spring. Furthermore, no plan has been discussed about how the WWE would be distributed. We need only to the ongoing battle between the Pac 12 Network with Direct TV and other distributors as a reason to be concerned about the network’s distribution.
Another note, the analyst upgrade does not address the company’s recent investment in social messaging startup Tout. How does that help or hurt the WWE stock?
While the upgrade is good for the WWE shareholders, the reasons for the positive spin leave an investor wanting to know more.