WWE stock continues to drop due to how Saudi Arabia’s Public Investment Fund (PIF) has acquired a minority stake in the PFL (Professional Fighters League).
It was announced on Wednesday that the PFL sold a minority stake in its company to SRJ Sports Investments, which was created through the Saudi PIF. SRJ is investing $100 million in the PFL. The deal includes major expansion for PFL, such as “Super Fight” pay-per-view events in the Kingdom of Saudi Arabia, and the launch of a PFL MENA (Middle East & North Africa) league, which they hope to have up & running by the second quarter of 2024. It was noted in the press release that the investment will help sign “top talent and star fighters,” while also accelerating global expansion.
WWE stock opened at $115.47 on Wednesday but by the end of the day shares had dropped to $110.03. The stock opened today at $110.05, but it has dropped just about all day, and as of this writing is at $95.61, which is down 13.12%. Today’s low as of this writing was $93.93.
Endeavor stock is also taking a hit today. The stock opened at $24.27 but as of this writing it is down to $21.84, or down 9.57%.
MMA has remained outside of the WWE world for the most part, but with Endeavor merging WWE and UFC as TKO in the next few weeks, it will be a part of the overall business. The stock dropping this week shows how investors are reacting to significant money being put into a TKO competitor, despite UFC dominating the market over PFL.
SeekingAlpha reported on Wolfe Wolfe Research stock analyst Peter Supino writing about how the PIF investment may impact WWE/UFC.
“While there is room for all to succeed in the growing MMA market, PIF backing augurs poorly for WWE and UFC’s medium/long term talent costs,” wrote Supino, who has an outperform rating and a $137 price target on WWE. “We think PFL’s accelerating investment plans represent a new overhang on WWE’s (and soon TKO’s) valuation multiple.”
Guggenheim stock analyst Curry Baker said he does not see the Saudi investment into PFL as a “game changer” for WWE or Endeavor.
“Bottomline: We do not view this as a game changer relative to the UFC’s MMA dominance,” wrote Baker, who has buy ratings on WWE and Endeavor. “In our view, the investment is not material enough to allow PFL to compete in depth of champions or across weight classes with the UFC or start developing a monetization ecosystem to sustainably compete against the UFC.”
Baker said he remains positive about the pending WWE – UFC merger.
PFL is really looking to compete with UFC as they expect YouTuber-turned-boxer Jake Paul to fight on one of their shows in 2024, as well as former UFC Heavyweight Champion Francis Ngannou, who signed a historic multi-fight PFL contract to fight MMA this past May after his UFC deal expired in December while still champion. Ngannou, who is scheduled for a boxing match against Tyson Fury on October 28 in Saudi Arabia, is also on the PFL global advisory board. It was also announced at the time of his signing that the deal makes him an equity owner and chairman of a planned PFL Africa league.
Stay tuned to WrestlingHeadlines.com for more.
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