WWE Market Value Drops $1 Billion After Co-Presidents Depart The Company
Several analysts have taken note of WWE’s massive drop in its stock, giving their insight into the news.
Shortly after the market closed on January 30, news broke that WWE Co-Presidents George Barrios and Michelle Wilson had departed the company, effective immediately. This left the company’s stock to drop by more than 27 percent in the ensuing days and the drop in stock equate to perhaps $1 billion in market value.
Per Bloomberg, John Belton cut his rating to in line from outperform and reduced his stock price target to $50 from $80, saying “the release announcing the changes was vague.” Alan Gould of Loop Capital also reduced the price target from $80 to $50 and added that his 2020 estimated for adjusted earnings before interest, tax, depreciation and amortization dropped from $390 million to $350 million.
MKM Partners’ Eric Handler does have a different outlook on the situation, noting that this does not necessarily mean that “more bad news is coming,” putting his price target at $92. Handler said, “Given the known step-up in the domestic TV rights deal, we do not believe the company is in a ‘precarious’ financial position.”
A change of that magnitude brought heavy ramifications as the stock dropped down to $58.00 by 4:40 p.m. ET. By 5:15 p.m. ET, it was down to $49.00. The lowest point came at 6:55 p.m. ET when the stock dropped to $47.70, marking a 23.44% drop in less than three hours. When the market opened at 9:30 p.m. ET on January 31, WWE stock was at $45.32, a 27.28% drop from what it was when the market closed on January 30. It’s the lowest the stock has been since May 11, 2018 when it was at $43.51.
WWE is set to report its 2019 Fourth Quarter earnings on February 6, 2020.
