4.9 billion is the market cap for the WWE.
1.1 billion was the revenue in 2021.
180 million was the profit.

Vince McMahon took over the WWE 40 years and now is retiring at 77.

I have never watched wrestling a single time in my life, but seeing how the company is worth nearly 5 billion dollars, I want to see if the company is worth the valuation.

Diving in, some data on the WWE.

First up, market cap.

4.9 billion is the current market cap of the WWE.
Up 214% from 2017.

However, they are still down in valuation 31% from 2019, likely due to fall from COVID as well as internal issues surrounding Vince McMahon.

Second, revenue and profit.

127% is the increase in revenue the last 10 years.
51% is the increase in the last five.

620% is the increase in profit the last 10 years.
429% in the last 5 years.

For both revenue and profit, the WWE has grown heavily, also showing no signs of slowing down, due to merchandise and increased streaming deals.

The third thing to do would be looking at comparisons to similar stocks with the WWE, but for this particular case, it’s hard to find a comparison.

The reason is very few publicly traded companies are content producers, which don’t have their own streaming services and rely on a mix of merchandise, physical ticket sales and streaming/television for revenue.

The only company I could really name is Disney, which is a huge jump in comparison, but I’ll make it.

Disney is currently worth 187 billion.
67.4 billion in revenue for 2021.
Only 2 billion in profit, but that’s due to COVID, where 2019, the profit was 11 billion, showing a 16% margin.

Comparing margins, the WWE is lower over what Disney normally is, but the WWE still holds a 9.5% profit margin.

Real test is just revenue and profit to market cap to see valuation.

The WWE is trading 4.4x revenue and 27x profit.
Disney is trading 2.8x revenue and 93x current profit.

This would make the case the WWE is overvalued, but there’s also the issue Disney is a poor example, due to it being lowered as a result of COVID. The company will likely recover soon and a 300 billion dollar market cap in the next 12 months is possible.

That said, where does the WWE fall in terms of investments?

It is financially stronger than in 2019, but worth noticeably less.

My feeling is the company would be recovering faster to 2019 levels, but hasn’t due to some scandals centering around Vince McMahon, who is now officially gone.

So, invest or not invest?

I’d say no, because better opportunities for growth like Disney exist.

That said, I think if someone were to buy WWE stock, over the next year, five years and ten years, they’d probably make a return. Just not a huge one.

Which again, not really sure why people are fans of pro wrestling, but everyone likes what they like and 1.1 billion made off of it is pretty amazing.