Market Overview

WWE Could Be A Big Winner Amid A Fragmenting TV Landscape; Network Has Room For Growth

WWE Could Be A Big Winner Amid A Fragmenting TV Landscape; Network Has Room For Growth
Related WWE
Jim Cramer Advises His Viewers On GEO Group, Nokia, WWE And More
WWE's Volatile Week: Rousey Reigns, Cena Backs Out, Hogan Returns

World Wrestling Entertainment, Inc. (NYSE: WWE) stock is up 58.5 percent in 2017, but one Wall Street analyst isn’t ready to tap out on the rally just yet.

The Analyst

JPMorgan analyst David Karnovsky initiated coverage of WWE with an Overweight rating and $37 price target.

The Thesis

According to Karnovsky, WWE still has a favorable risk/reward balance given its upcoming TV contract renewal cycle.

“With unique entertainment assets and global fan appeal, we believe WWE is well positioned to monetize its video content amid a fragmenting media landscape of television networks, distributors, and technology platforms all seeking differentiation,” Karnovsky said Wednesday.

JPMorgan is projecting a 7 percent compound annual revenue growth for WWE over the next three years, and Karnovsky said investors can expect WWE Network subscriber counts to continue to tick higher as the company optimizes and customizes its content.

Karnovsky said tiered network plans are likely coming at some point, and WWE’s transition to an over-the-top content model way back in 2014 puts it ahead of the game as other media companies scramble to catch up.

Karnovsky said both tax reform and potential contract renewals could serve as bullish catalysts for WWE over the next year. Management has kept contract expectations in check, and WWE’s improved brand image and large global presence make it an attractive option for advertisers. He said investors aren’t fully appreciating the company’s opportunities in the U.K. and India as well.

Price Action

Following JPMorgan’s bullish call, WWE stock traded higher by 2.4 percent Wednesday to $29.42.

Related Links:

10 Craziest WWE Hell In A Cell Moments Of All Time

WWE's Labor Day Announcement: We're Working On Christmas And New Year's

Image credit: Miguel Discart, Flickr

Latest Ratings for WWE

Oct 2018Morgan StanleyMaintainsOverweightOverweight
Oct 2018CitigroupMaintainsNeutralNeutral
Aug 2018CitigroupMaintainsNeutralNeutral

View More Analyst Ratings for WWE
View the Latest Analyst Ratings

Posted-In: David Karnovsky JPMorgan WWE NetworkAnalyst Color Price Target Initiation Analyst Ratings Best of Benzinga


Related Articles (WWE)

View Comments and Join the Discussion!

Latest Ratings

JBLGoldman SachsUpgrades0.0
JRVRKeefe Bruyette & WoodsDowngrades40.0
ADMPB. Riley FBRDowngrades2.5
EAFVertical GroupDowngrades9.0
View the Latest Analytics Ratings
Don't Miss Out!
Join Our Newsletter
Subscribe to:
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Fintech Focus
Your weekly roundup of hot topics in the exciting world of fintech.
Thank You
for registering for Benzinga’s newsletters and alerts.
• The Daily Analysts Ratings email will be received daily between 7am and 10am.
• The Market in 5 Minutes email will be received daily between 7am and 8am.
• The Fintech Focus email will be received every Friday between 2pm and 5pm.

Boston Beer: Does Stock Momentum Outweigh Expensive Valuation?

Applied Materials Outperforms Despite Volatility, Says Wells Fargo