Unpacking WWE's Impressive Earnings History

World Wrestling Entertainment has been a huge outperformer in its quarterly earnings

Dec 17, 2020 at 10:04 AM
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World Wrestling Entertainment, Inc. (NYSE:WWE) is an American entertainment company that is most well-known for professional wrestling programming. The company has also branched out into other fields, including movies, football, and various other business ventures. In most recent news, on Dec. 11, WWE announced an agreement to expand its partnership with IB SPORTS in South Korea.

So far this year, the wrestling giant's performance has notably defied Wall Street's expectations. The company has managed to beat analysts' earnings expectations on a consistent basis in 2020, and often by considerable margins. Specifically, WWE beat expectations on all four of its most recent earnings reports. The company's biggest earnings beat was reported in the second quarter of 2020, when it reported an earnings per share (EPS) of $0.52, an incredible margin of $0.38. While the company isn't slated to report earnings again until early 2021, the company's outperformance on earnings compared to expectations should be noted. At this time, WWE will enter the earnings confessional on Jan. 14 with an expected EPS of $0.33.

WWE also has a forward dividend of $0.48 and a forward dividend yield of 1.05%. The company last paid a dividend of $0.12 in the third quarter of 2020. WWE has paid out dividends to investors since 2006.

Despite the positive year the company has had, World Wrestling Entertainment stock is still down 32.5% year-to-date, making its current price an intriguing potential entry point for investors. WWE did manage to hit a fresh annual high of $67.53 in early January, but fell all the way to $29.10 by mid-March.

WWEDaily

Furthermore, WWE has unexpectedly grown its revenue and net income in 2020. The entertainment company added just about $100 million to its annual revenues and, more impressively, $110 million to its net income. These new figures mark a massive 140% increase in net income compared to what the company reported in 2019. In addition, the equity has now strung together quite a few years of top and bottom line growth. Perhaps most stunning is the company’s net profit growth over the last few years. WWE has produced $187 million in net profits in the past 12 months, which is exponentially more than the $32.6 million it ended the year with in 2017. World Wrestling Entertainment stock currently trades at a price-earnings ratio of 20.84.

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