TV Negotiations Have WWE Worth More Than $2 Billion
The ongoing rights negotiations taking place between the WWE and major television networks has raised the company’s stock to historical levels. This is a major step forward from the slight decreases we had been seeing over the last couple of weeks.
WWE’s stock is currently being traded at $27.03 a share, which is the highest it’s been since shortly after the company went public in Oct. 1999. With the significant stock increase, the WWE’s market capitalization broke the $2 billion mark and is currently positioned at $2.03 billion. This is a major milestone for the company.
Much of the stock increase may be attributed to the negotiations taking place over rights fees for WWE’s television programming. There’s an old saying on Wall Street that you buy on speculation and sell on results. While we have yet to see the results, the speculation is obviously quite optimistic.
This isn’t the first time that WWE stock has been on the rise. Prior to the launching of the XFL in 2001, there was a lot of promising speculation and WWE’s stock rose significantly. However, while the speculation was great the results were terrible. After fantastic early ratings, the XFL bombed horribly and folded after only one season. Predictably, WWE stock fell as a result.
According to Dave Meltzer of the Wrestling Observer Newsletter, WWE is looking to double their rights fees when they land a contract with either the same network (NBCUniversal) or a new one. WWE has been on the open market since NBCU’s exclusive negotiating period expired on Feb. 14.
Who has the most interest in taking on WWE’s programming? For the most part, it’s been all quiet on the western front. Very little has been heard about offers being made, the networks making the offers and who the frontrunners are. According to people in WWE, we’ll most likely have our answer some time between Apr. and May 1.
FOX may have the most available money to throw at WWE for their TV rights. Their new sports station, Fox Sports 1, is struggling mightily, and perhaps they feel adding wrestling to their channel will bring in substantial viewership. Unfortunately, FS1 is not offered in a ton of households and they don’t have an existing base audience for wrestling. WWE might be shrewd to stay away from that one.
The two most likely landing spots are NBCU and Spike. WWE had a nasty split with Viacom, which owns Spike, back in 2005 when the WWE returned to the USA Network for the first time in almost five years. They’ve been with NBCU ever since. It will be interesting how this will effect negotiations, if at all.
It’s still too early to tell how all of this will play out, but the WWE’s current financial position is historically strong. When the dust settles, there’s a good chance the company lands an immensely lucrative TV deal.