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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
World Wrestling Entertainment, Inc. (XNYS:WWE) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
WWE
Name:
WORLD WRESTLING ENTERTAINMENT, INC. (XNYS:WWE)
Sector:
73.96M
Industry:
Entertainment
CEO:
Mr. Vincent McMahon
Total Employees:
870
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -141.17% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF WORLD WRESTLING ENTERTAINMENT, INC.(WWE) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND ENTERTAINMENT INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
67.8
One Month Price Target:
$68.25
Six Month Price Target :
$70.53
Likely Price in One Year's Time:
Ticker:
$73.25
Likely Trading Range Today Under (Normal Volatility)
$67.53
Price Upper limit ($) :
$68.13
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$64.22
This week:
$59.79
This month :
$51.77
Other Primary facts
Market Cap:
5.03B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
74.40M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
14.64%
-21.54%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$84.43
$76.80
$51.17
$58.80
Medium risk (<10%) entry points
Buy Call
Sell Call
$74.32
Buy Put:
Sell Put:
$72.69
$61.26
$62.91
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
WWE
Sharpe Ratio:
1.41%
Comparison:
WWE, is amongst the top 60% stocks with highest risk-adjusted returns
Sharpe ratio is 343.01% higher than the industry
& is -37.95% lower than the market/S&P 500 average
Average Returns/Yield of
WWE
Daily returns:
0.05%
Weekly returns:
0.23%
Monthly returns:
0.91%
Yearly returns:
6.78%
Comparison of returns:
Average annual returns/yield (last 3 years) is 61.27% above industry average
Classification:
WWE, is amongst the top 60% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.85
Statistical test of Returns:
WWE has not yielded statistically significant higher returns when compared to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.60%
Weekly Volatility:
5.81%
Monthly Volatility:
11.61%
Yearly Volatility:
40.22%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.89%
Volatility in last five trading days has been -65.64% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-5.29%
Weekly VaR:
-11.82%
Monthly VaR:
-23.64%
How Much Can the price of
WWE
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-20%
Worst case (decline):
-81.89%
This translates to price declining to:
$53.98
This translates to price declining to:
$12.28
Severe Crash Probability
Risk of crash in next 6/12 months: Medium (<50%)
What is Value at Risk (VaR)?
Risk Fundamentals
WWE is a 66.85% riskier investment compared to the market/S&P 500 & is 42.94% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -24.00% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
WWE
Beta in relation to market/S&P 500--1.20
Expected beta in 1 year's time:
0.825
Expected beta in 3 year's time:
1.167
Unlevered (debt free) Beta:
0.676
Beta in relation to Nasdaq (XNAS):
0.614
Beta in relation to all global stocks::
0.597
Beta Comparison & Analysis
Beta of competitors/peers::
0.775
Beta is 54.35% higher than peers
Average Industry Beta:
1.34
Beta is -10.73% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
39.10%
Sustainable growth rate is 9.78% above industry average
Alpha provided | Alpha Analysis
Alpha provided:
-0.004
Alpha is -92.65% below industry average alpha yield
Alpha is -26% below the market average
Analysis of Cost of Capital of
WWE
Equity cost of capital:
0.113
Equity cost of capital is -7.99% below industry mean WACC
Unlevered (without debt) cost of capital:
6.41%
Before-tax cost of debt:
4.96%
After-tax cost of debt:
3.92%
Overall debt rating:
Lower BB medium grade (Fifth highest grade)
Weighted average cost of capital (WACC):
3.92%
WACC is -12.73% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$15.66
Revenue growth rate per share of (3Y):
12.43
Annual revenue growth rate is -30.73% below industry average
EPS:
$2.37
Expected Annual growth rate of EPS (3Y):
28.89%
Expected future EPS growth rate is -8.64% lower than the Entertainment industry
Free cash flow (FCF) per share:
$2.13
Balance sheet equity growth per share: -2.35%
Equity growth rate per share is -2055.51% lower than the industry
Debt per share
$5.43
EBITDA per share
$5.16
Valuation Analysis Today of
WWE
P/E Ratio:
26.41
P/E Ratio of Competitors/Peers:
23.03
P/E ratio is 14.70% higher than main peers & is -2.30% lower than the industry
Stock price/value with industry average P/E ratio: $64.07
WWE is 5.83% overvalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $15.09
Present value of the expected future dividends only: $4.23
P/S (Price to Sales ratio):
4.33
Price to sales ratio is 63.55% above the industry mean
P/B (Price to book value ratio):
12.43
Price to free cash flow: 31.81
Price to free cash flow ratio is 33.76% higher than the industry
Net income growth rate (3Y):
80.92%
Net income growth rate is -139.27% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 4.41%
Dividend yeild: 0.71%
Previous Dividend: $0.12
Previous adjusted dividend: $0.12
Previous Dividend: $0.48
-
-
Average dividend payment (long-term): $0.12
Average dividend increase/decrease (growth rate) % per period: 0.00%
Expected next dividend payment date: 26/09/2022
Expected next dividend record date: 13/09/2022
-
Previous dividend payment date: 27/06/2022
Previous dividend record date: 15/06/2022
-
Dividend History:
2022-06-14--$0.12
2021-12-14--$0.12
2021-06-14--$0.12
2022-03-14--$0.12
2021-09-14--$0.12
2021-03-12--$0.12
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
99.46%
Net debt to equity ratio:
130.14%
Debt to assets ratio:
32.41%
Net debt to assets ratio:
42.41%
Debt-to-asset ratio is -54.47% below industry average
Ability to repay debt:
Interest coverage ratio:
12.2
Interest coverage ratio is -83.60% less than industry average
Looking forward:
Debt growth rate:
87.53%
Annual debt growth is -77% lower than industry average debt growth rate
Debt repayment rate in last quarter: 0.87%
Analysis of Key Statistics
Correlation of price movement with the market:
0.447
Statistical significance of correlation:
WWE has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.508
Stock price is -12.14% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.508
Correlation of price movement with Nasdaq (^IXIC):
0.032
Covariance of price movement with the market:
0.048
Kurtosis
13.687
Returns have severe fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are considerably more likely, compared to assets with normally distributed returns
Skewness of returns:
-1.236
Returns are left (negative) skewed; mean returns are lower than median and mode returns
Fundamental Analysis & Dupont Analysis of
WWE
Gross Profit Margin Ratio:
178%
Operating Profit Margin Ratio:
24.58%
Operating profit margin is 272.44% higher than the industry
Net Profit Margin Ratio:
178%
Effective Tax Rate:
22.71%
Effective tax rate is 46.38% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
49.92%
Return on equity (ROE) is -3.32% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
16.27%
Return on assets (ROA) is 275.81% higher than the industry
Financial Leverage:
1.5x
Current Ratio:
1.53
Current ratio is -6.46% below industry average
Cash Conversion Cycle (days):
51.6
Cash conversion cycle is 6.60% above industry average
The remaining useful life of property plant & equipment is: 18.3 years
Stock based compensation to net income ratio:
4.75%
In-depth Efficiency Analysis
Revenue generated per employee:
1.3M
Each employee generates 39% more revenue than industry average revenue per employee
EBITDA generated per employee:
440.9K
Each employee generates 27% more EBITDA than industry average revenue per employee
Profit generated per employee:
232.9K
Each employee generates 103% more net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
85.0K
Each employee generates -242696% less free cash flow than industry average revenue per employee
Assets/Capital per employee
683.2K
Each employee generates -242696% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
WWE
LGF-B
LGF-A
SHUTTERSTOCK, INC. (XNYS:SSTK)
MADISON SQUARE GARDEN SPORTS CORP. (XNYS:MSGS)
TEGNA INC. (XNYS:TGNA)
SOGO
AUTOHOME INC. (XNYS:ATHM)
IHS Holding Limited (XNYS:IHS)
Turkcell Communication Services Inc. (XNYS:TKC)
Current Analyst Ratings
Strong buy�13%
Buy�13%
Hold�29%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
1.17B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
646.71M
518.39M
-
123.51M
192.26M
68.75M
39.77M
232.02M
-
31.45M
89.98M
383.57M
286.37M
202.62M
262.14M
59.53M
202.62M
Statement of Cash Flow
Date:
Period:
25.32M
Differed Income Tax :
297.00K
Stock Based Compensation :
9.62M
Change in Working Capital :
- 6167.00K
Accounts Receivables:
7.80M
Other Working Capital:
9.29M
Other Non-Cash Items:
345.00K
Net Cash Provided by Operating Activities:
95.45M
Investments in PP&E:
- 21487.00K
Net Acquisitions:
-
Purchases of Investments:
- 111623.00K
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
105.59M
342.22M
447.81M
163.19M
9.20M
30.72M
650.92M
507.07M
-
15.80M
11.62M
16.75M
43.20M
594.43M
-
1.25B
20.69M
230.08M
1.73M
83.95M
90.43M
425.15M
403.67M
10.69M
414.36M
-
839.50M
744.00K
17.84M
697.0K
-
March 31, 2022 at 6:00:00 AM
878.73M
405.84M
1.25B
353.84M
633.75M
528.2M
47.42M
-
- 85686.00K
- 3541.00K
1.24M
- 30006.00K
- 8931.00K
2.24M
- 38998.00K
-
- 29234.00K
105.59M
134.83M
95.45M
- 21487.00K
73.96M
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
WWE
2023
2024
2025
2026
2027
$83.54
$90.25
$97.51
$105.34
$113.81