An integrated media & entertainment company engaged in the development, production & marketing of television and pay-per-view programming and live events and the licensing and sale of consumer products featuring World Wrestling Entertainment brands.
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it's fake
Do you not own a television?
believe it or not, i actually own two televisions. but before i continue listing everything that i own, i should probably elaborate upon my lame pitch and give three reasons why i think WWE is going to underperform the market.
1. the employees
if the very best collegiate wrestlers wanted to pursue their grappling interest beyond the NCAA, before the rise of mixed martial arts, they either became professional wrestlers (if they were lucky enough to get a degree in drama) or became a high school / college wrestling coach. although the UFC doesn't pay as well as WWE, collegiate wrestling national champions and all-americans now have the option of a career in MMA. even wrestlers such as Dan Severn, Brock Lesnar and Bobby Lashley who had successful careers in professional wrestling left for MMA. with current WWE talent considering a switch to MMA and college wrestlers having an additional option to pursue their trade outside of professional wrestling, the WWE will have to fill their rosters with more buff actors and charismatic body builders as the pool of legitimate wrestlers who want to be pro wrestlers becomes smaller and smaller.
2. the product
in 2008, before embarking on her aspirations in a political career, linda mcmahon changed the WWE programming rating from TV-14 to PG. this move alienated their most crucial demographic who was accustomed to the sexual themes and realistic violence that had been prevalent in WWE's "attitude era". the viewers who were watching for the "realistic violence" may look for other programming to scratch their violence itch, perhaps even seeking out mixed martial arts or boxing. WWE's strategy is to show "family friendly" content in hopes of capturing younger views and (hopefully) keeping them interested for many years to come. this may be a great way to increase their fan base for the future, but for now the fans who used to tune in to see TV-14 content are going elsewhere.
3. the consumer
WWE has several television shows (Monday Night RAW, WWE NXT, WWE Superstars and Friday Night Smackdown) and their tv rights revenue has increased from $111.9 million in 2009 to $127 million in 2010. despite the increase in tv revenue, their ratings have been in steady decline.
their pay per view revenue has decreased from $80 in 2009 to $70.2 million in 2010. this could be because of the recession and folks have less money to spend on their entertainment or or could be more and more people are instead buying UFC pay per views. pay per view events, for those of you who don't know, cost around $50. to buy two pay-per-views in one month would basically double your cable bill for the month, so if a male teen was limited to only one ppv event per month - they would have to choose between seeing Brock Lesnar fighting for his position as a heavyweight title contender in the UFC or a couple of guys where Brock used to work, pretending to fight for a title where the outcome has been predetermined and might change as soon as following free broadcast of Monday Night RAW.
in summation, i'm not trying to compare WWE to UFC. they're different animals. but as far as the source of their talent pool and PPV buys, they are competing against each other on some level. WWE will survive, their management has found ways to continue to reinvent the product, crush other wrestling competition and market video games, movies, television shows as well as live events and pay-per-view. although my opinion is that the WWE will underperform the market for at least a year, possibly for as long as 3.
"this could be because of the recession and folks have less money to spend on their entertainment..."
WOW, you are a genius. It also depends on how you calculate your under-performance. If you are not taking in an 8% dividend in your calculations, which you never once made any reference to, then your assumptions are quite faulty. Ultimate fighting has no theater and anyone who knows anything about this endeavor knows full well that wrestling is all about the drama leading up to the actual match and UFC doesn't even try to go there.
I'm neither a UFC or WWE fan but of the two whenever I've watched UFC, it bores me to tears. People like a good show. To waste two seconds trying to figure out if it's REAL or not is stupid. That's not why people go. Figure that out and you'll see why it persists down through the years.
it's great that you find the WWE a stimulating source of entertainment, but how long do you think a company can sustain an 8% dividend with a payout ratio of nearly 300%? you don't have to be a genius like me to figure out what's going to happen to the share price once the dividend takes a dive.