© Reuters. BofA begins WWE, UFC proprietor TKO Group (TKO) at Purchase
Financial institution of America Securities analysts initiated analysis protection on UFC and WWE proprietor TKO Group (TKO) with a Purchase ranking and a goal value of $100.
“TKO, fashioned in Sept. 2023, represents a mix of two iconic manufacturers, wrestling juggernaut WWE and blended martial arts league UFC, with important synergies and progress potential,” analysts mentioned.
The funding financial institution tasks a 13% compound annual progress fee (CAGR) for TKO in fiscal 2025 and 2026 years, in addition to a 20% EBITDA CAGR and a 34% FCF CAGR growth.
Analysts imagine this presents “a sexy mixture of top-line progress, margin growth and free money circulate era.”
BofA analysts take into account the upcoming US media rights agreements for the UFC as the important thing driver for TKO’s mid-term efficiency.
Regardless of media rights purchasers turning into pickier, as proven by SmackDown’s modest rights improve, Netflix’s (NASDAQ:) latest acquisition of Uncooked rights introduces a worldwide participant, probably boosting WWE’s worldwide attraction in the long term, they famous.
“We imagine UFC’s US rights stay the crown jewel throughout the TKO’s media rights portfolio and can command important will increase upon renewal in ’26,” wrote BofA’s workforce.
