World Wrestling Entertainment, Inc. (NYSE:WWE) has had a brutal 2020 up to this point, but at least one analyst said Thursday the company could still have a record year.

The WWE Analyst

MKM Partners analyst Eric Handler reiterated his Buy rating for WWE, but cut his price target from $58 to $48.

The WWE Thesis

Handler said WWE still has an opportunity for tremendous growth over the next several years. WWE’s live event business has taken a big hit from COVID-19. All recent live events and future live events have been either cancelled or moved to WWE’s performance center in Orlando.

In light of the recent developments, Handler cut his first-quarter revenue and adjusted OIBDA estimates from $298 million and $64 million to $283 million and $49 million, respectively. He also cut his full-year revenue and adjusted OIBDA estimates from $1.203 billion and $280 million to $1.117 billion and $194 million, respectively. Still, both numbers would represent all-time records for the company.

“Furthermore, our estimates do not yet take into account any improvements from the recently completed India TV deal or any cost savings from belt tightening during the coronavirus pandemic,” Handler wrote in a note.

Handler said the new five-year India TV deal may be worth more than investors realize given WWE’s willingness to sign a longer-term deal and the inclusion of additional content, such as the NXT branded weekly shows.

In addition, he said WWE has optionality in its Middle East TV deal and its potential to sell the WWE Network.

Benzinga’s Take

The loss of WWE’s live event revenue is certainly a blow to the struggling company. However, WWE is still producing content, and its content partnerships with Walt Disney Co (NYSE:DIS) subsidiary ESPN and Fox Corp (NASDAQ:FOX) are proving extremely valuable during this stay-at-home environment in which there is no live sports content available.

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