For nearly seven decades, millions of fans around the world have watched some of the most spectacular scripted fights live through the WWE and its predecessors. Through the years, WWE has remained committed to providing its viewers – both live and on television – with the most entertaining wrestling experience, often based around specialized storylines and characters.
Though interest in wresting in general has waned in last decade, the WWE continues to go strong and turn a profit. But that being said, is the WWE a wise pick for stock-based investment? A variety of factors will come into play if you choose to pursue WWE stock, such as the company’s current financial standing, its history, its profit structure, its liabilities, and more.
But if you are able to account for all of these core factors, you’ll be ready to consult your favorite investment platform and order a few shares of WWE stock as soon as today. Even if you aren’t a huge wrestling fan, you should consider purchasing WWE stock. Depending on your circumstances, it may hold the potential to diversify your investment portfolio in a wholly novel manner.
Step #1 – Learn About the Company
As with any stock investment, you should start off your investment process into WWE with some focused research into its biographical information. As you dig beneath the surface over the course of this step, you’ll grow in your understanding of several core factors that may affect WWE’s stock performance down the line.
At its core, WWE provides live and televised “sports entertainment” centered around wrestling. Often, this comes in the form of pre-scripted events that engage several wrestlers by means of their wrestling personas or characters. In effect, WWE wrestling matches are a form of dramatic theater that relies on elements of wrestling sports as a performance medium.
WWE distributes its products through a variety of branded subsidiaries, the most prominent among which are “Smackdown Live” and “Raw.” Presently, the majority of WWE’s products are broadcast internationally through pay-per-view television channels.
The WWE (formerly World Wrestling Entertainment) traces its origins back to 1952 with the emergence of the Capitol Wrestling Cooperation and the National Wresting Alliance. The company became the World Wrestling Federation 1979 and took on its modern form (and ownership structure) when current chairman and CEO Vince McMahon bought into the company starting in 1980.
Since that time, McMahon’s Titan Sports Inc. has led the WWF (which changed its name to World Wrestling Entertainment in 2002 and shortened to “WWE” only in 2011) to exceptional worldwide popularity. This included the introduction of WrestleMania, a Super Bowl-like event that allowed the WWE’s unique brand of scripted wrestling to find broad appeal.
Without question, WWE currently rules the roost when it comes to scripted wrestling entertainment. However, in 2019, a new promotion of a similar nature – dubbed All Elite Wrestling (AEW) – was spearheaded by Shahid Khan (owner of the NFL’s Jacksonville Jaguars, among others). Though it has yet to gain a foothold, present speculation holds that it may eventually be able to compete with WWE in the near future.
Historically, though, WWE has faced harsh competition from other similar wrestling entertainment groups. This was most noteworthy during the so-called “Monday Night Wars,” when WWE’s prime broadcast competed with the same from Raw and World Championship Wrestling (WCW). WWE won out in the end, as it now owns Raw’s branding and acquired many of WCW’s assets when it went out of business in 2001.
Step 2 – Research Financial Standing and Outlook
With its biographical information in mind, you’ll be ready to continue your research into WWE. Next, you’ll need to gain a working understanding of this company’s present financial standing and outlook. This includes a critical appraisal of any liabilities that may cause the company’s stock to acutely lose value in the near-future.
If you’re in a hurry to invest in WWE stock, consider some of the following questions as you work fill out your understanding of WWE’s present financial standing:
- Has this company been profitable recently? To what degree (in dollars)?
- What assets does this company hold? How do those assets compare to their liabilities?
- How does the company make money? What is its business model?
- Who is leading the company? Has their leadership brought stability to the company?
- Does this company have any upcoming products or services that are expected to make a major impact on consumers?
- Have any current events (such as changes in regulation policy or distribution contracts) effected this company?
WWE profits on a variety of diversified fronts, all of which are centered around the facilitation of its core wrestling entertainment product. For example, WWE makes a hefty sum of its annual profit on the back of its lucrative television contracts (which were renewed in 2019 to the tune of $462 million). Along the same lines, WWE makes a smaller supplementary profit through these contracts as a result of pay-per-view subscriptions with the contracted cable companies.
Also, WWE makes a consistent profit year to year on the back of their contracted wrestlers. In most cases, WWE reserves the ability to use these wrestlers’ likenesses in almost any medium, allowing them to produce and distribute merchandise without many contractual restrictions.
Debts, Losses, and Major Liabilities
As a result of its corporate structure and talent ownership structure, WWE is notably less susceptible to evaluation problems relating to its debts. Looking towards the future, WWE is expected to maintain a tight control of its costs as it attempts to reestablish itself as a popular entertainment option on primetime television.
That being said, WWE has had many, many controversies surrounding its business dealings over its entire history. Many of these have focused on WWE’s treatment of its talent, the contracted wrestlers. In many cases, outside observers have accused the company of ignoring its performers’ latent health concerns and substituting proper care with forced steroid use.
Step 3 – Prepare your Brokerage Account
If the facts align in a desirable manner, you may be positioned to buy at your earliest convenience. To do this, you’ll need to take advantage of a stock brokerage service (either traditional or digitally self-managed). In either case, you should fully ensure that your personal plans align with the stock predictions before committing to a purchase of their shares.
Open a Brokerage Account
Naturally, you’ll need a brokerage account (if you don’t already possess one, that is). These are more accessible than ever, with industry stalwarts and robo-advisors alike competing to bring a new generation of investors into the marketplace. Many of these brokerage platforms offer investment incentives, making it easier to get into the market with minimal initial financial resources.
Our broker of choice is Webull. Why? Because it’s completely FREE! (like Robinhood) But it offers more features including IRA accounts. Also, when you open an account, you will get a Free stock.
A Role in your Invest Plan
Before committing to a purchase of stock, you should certainly have a realistic discussion with yourself to determine if the stock content and outlook matches your personal investment plans. More specifically, you should evaluate whether or not it’ll will help you diversify your portfolio and meet your investment goals.
Should you need it, a brokerage advisor can be a major asset in this step. If you’re new to stock investment in general, then you’ll definitely want to seek professional advice regarding the many ways this stock may affect your investment portfolio. Don’t skimp on this step, either, as it may be the difference between gaining and losing on your first stock purchase.
Now that you have an account, it’s time to Buy!
Finally, the step you’ve been waiting for! Using your platform of choice, you can now purchase a handful of stocks and begin monitoring them for value fluctuations. That being said, not all stocks are precisely the same, requiring a few more particulars to be addressed before completing the stock purchasing process.
Depending on your chosen investment strategy, you’ll need to choose the number of shares to add to your personal portfolio. The total order cost is going to be the number of share x the price of the stock. Example, if a stock is trading at $14.23 and you want to buy 10 shares, then it’ll cost 14.23 x 10 = $142.30
Finally, before finalizing your stock purchase, you’ll need to decide what “order” of stock you’d like to hold. Stock “orders” fall into three primary categories: market, limit, and stop. Market orders are the first and most obvious option for those who want to gain stock and do it quick. That’s because this option immediately executes a stock purchase, regardless of its present market price.
On the other hand, though, you can limit your initial investment cost by putting in a limit order. This allows you to automate a platform to only purchase stock if it floats down beneath a certain value-based threshold. This type of investment order will likely take longer and may not execute at all if the value of the desired stock never dips that low again.
Finally, when you want to further automate your stock purchasing and selling process, you can put in several stop orders. A buy-stop order, for example, can initiate a market order as soon as a stock value dips below a certain optimal value. In the same vein, a sell-stop order is able to sell off your existing stock if it loses a certain amount of value.
You have all the tools and information you need to purchase your next stock. Now it’s up to you whether to take the leap. Happy investing!
P.s. Don’t for get that Webull is FREE and you will get a free stock when you open an account. (For a limited time only)
As noted above, WWE’s operations have been roiled in controversy throughout much of its past and into its present. Despite renewed commitments to the health of its contracted wrestlers, WWE has often been accused of pushing strong pain relief drugs on its entertainers (as evidenced in 1994 trial of CEO Vince McMahon’s role in distributing steroids). Given public perceptions of these practices, new accusations on this front could severely handicap WWE’s future prosperity.
Also, the WWE’s current relationship with Saudi Arabia (and specifically, its royal government) have recently come under regulatory fire. Given the oppressive nature of the Saudi state (as well as its involvement in a controversial civil war in neighboring Yemen), WWE has repeatedly faced calls from the public and US government to cease operations on the peninsula. If US trade policy towards Saudi Arabia were to change in the near-future, WWE may find itself without legal access to one of its newest markets.