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World Wrestling Entertainment (NYSE:WWE) has been upgraded to Buy from Hold by Loop Capital following the news that Vince McMahon has retired as Chairman and CEO of WWE.
Last week McMahon said that he feels it’s time to retire as Chairman and CEO of the wrestling entertainment company, with Nick Khan and his daughter Stephanie McMahon taking over as co-chief executive officers.
A Loop Capital analyst has reacted by upgrading the stock, and raising the firm’s price target on WWE to $90 from $69 per share, based on a greater likelihood that the company will be sold now that Vince McMahon has stepped down.
“WWE is a unique franchise and our base case 2025 EPS, the first full year post the US TV renewal is $5 per share, and could easily be $6 based on the trend of recent sports rights. As discussed in SportsNaut and other sources, logical buyers include Comcast (NASDAQ:CMCSA), Disney (NYSE:DIS), Amazon (NASDAQ:AMZN), and even possibly Netflix (NASDAQ:NFLX). The prospect of a deal should also help put a floor under WWE’s shares relative to the market,” said the analyst.
Elsewhere, an MKM Partners analyst maintained a Buy rating on WWE, but raised the price target on the stock to $79 from $70 per share.
He said that while the retirement of Vince McMahon marks a major event in WWE history, the capabilities and experience of those now fully running the company will not result in any consequential disruptions to the business.
“If anything, speculation of a potential sale of WWE now increases, and in our view, there would be no shortage of suitors. Accordingly, we are raising our price target from $70 to $79, which equates to 15x our 2023E adjusted OIBDA. Meaningful growth potential from upcoming domestic TV rights negotiations for Raw and Smackdown provide additional fundamental support for our increased price target,” wrote the analyst.
