This Analyst Sees 1.51 Million Paid WWE Network Subscribers

The biggest driver of World Wrestling Entertainment, Inc. WWE's stock over the past two years is WWE Network, its OTT subscription service. The company is expected to report Q2 results in late July, and Needham came out with a note Tuesday morning with an early preview.

"On April 4, 2016 WWE stated that it had 1.82mm OTT subs, the day after Wrestlemania, and guided to 1.50mm average paying subs for 2Q16," Needham said in a note. "We estimate average paying subs will be 1.51mm, slightly higher than guidance for 2Q16. We estimate that actual paying subscribers were 1.66mm on June 30, 2016 up from 1.36mm on March 31, 2016."

Related Link: WWE Network Has Transformed The Company's Earnings Power

The note continued, "Although we maintain our revenue estimate for 2Q16 at $184mm (up 23% y/y), our OIBDA estimate at $8.7mm (down 34% y/y), and our EPS from Continuing Operations estimate at $0.02 (down 76% y/y), we rebalance our mix to reflect: a) higher growth expectations for Television, Digital Media, Merchandising and WWEShop; offset by b) lower y/y growth in Licensing (for games, etc)."

The firm maintained its Buy rating and $25 price target.

Shares traded recently at $17.58, down 0.9 percent on the day.