Why World Wrestling Entertainment (WWE) Stock Is Up in After-Hours Trading Today

NEW YORK (TheStreet) -- Shares of World Wrestling Entertainment  (WWE) rose 2.26% to $14.95 in after-hours trading Wednesday after the company announced a partnership with FOX Sports Latin America (FOXA) to deliver 480 hours of original WWE content per year to Latin American nations.

The deal will bring WWE programming to 56 million homes on multiple FOX Sports and FOX Premium platforms throughout all of Latin America, including Mexico, Brazil, Argentina, Colombia and Venezuela.

The partnership takes effect on Monday, October 6, when FOX Sports airs a live broadcast of WWE's flagship show Monday Night Raw. Other original WWE programming such as Friday Night SmackDown, Main Event, NXT and WWE Vintage Collection will air weekly FOX Sports, FOX Sports 2 and regional digital platform FOX Play. WWE's pay-per-view events will be available on FOX Premium in Latin America and on FOX Play in Brazil.

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Separately, TheStreet Ratings team rates WORLD WRESTLING ENTMT INC as a "hold" with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:

"We rate WORLD WRESTLING ENTMT INC (WWE) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its solid stock price performance, revenue growth and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and disappointing return on equity."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • Despite its growing revenue, the company underperformed as compared with the industry average of 8.0%. Since the same quarter one year prior, revenues slightly increased by 2.6%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • WWE's debt-to-equity ratio is very low at 0.12 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.34, which illustrates the ability to avoid short-term cash problems.
  • The gross profit margin for WORLD WRESTLING ENTMT INC is rather low; currently it is at 21.85%. It has decreased significantly from the same period last year. Along with this, the net profit margin of -9.27% is significantly below that of the industry average.
  • Net operating cash flow has significantly decreased to $4.69 million or 60.24% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • You can view the full analysis from the report here: WWE Ratings Report

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