WWE shareholders are waking up to nervous times this morning. Yesterday’s news of Vince McMahon’s latest sex scandal broke after the markets closed. Today will be telling as far as how much the company will be devalued by the reports, which have now reached many mainstream media outlets.
The situation for WWE as a company is unique. Due to their broadcast and streaming rights deals as well as pre-arranged agreements with the Saudi government, WWE’s revenues are generally fixed. Whether the company puts on good shows or sells a single ticket, they are still making billions from NBC Universal, Fox, and others.
Dave Meltzer talked about what might happen with WWE’s stock price on the latest Wrestling Observer Radio. WWE’s stock has been outperforming others due to the revenue certainty. With that said, skittish investors may back off from the company due to the negative news about Mr. McMahon.
“The big thing is, you know, this broke today. It broke after the stock market closed today. So, how the stock market reacts, and the story was huge, I mean it was not just some wrestling story. It was covered by every major outlet almost immediately. All the big business outlets. It broke on the business side, so it will be interesting.
You know, WWE stock had been doing very, very well for reasons we talked about, you know, in the newsletter for the last couple weeks in the sense of in very uncertain economic times, which we are in, very uncertain, their money is all guaranteed and their profit margin is all guaranteed, which is not the case with most companies these days where, you know, cutbacks in consumer spending can hurt the revenues and profits of a lot of companies and with WWE, I suppose a company could default, but essentially, their revenues are guaranteed for the next several years.”
With the Vince McMahon scandal receiving heavy play on mainstream business news networks, trouble could be on the horizon. It is also possible that WWE shareholders keep a level head, knowing the company has revenue secured for years. Fans will have to keep an eye on the stock ticker to see what will happen.
What do you think of this story? Let us know in the comments!
Transcription by Ringside News