Investment firm Susquehanna has begun its analysis of TKO Group (TKO, Financial) by assigning a Positive rating to the company. Analyst Joseph Stauff has set a price target of $180 for TKO. According to Stauff, TKO Group stands out because of its strategic structural benefits that are expected to enhance its performance over time.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 18 analysts, the average target price for TKO Group Holdings Inc (TKO, Financial) is $167.17 with a high estimate of $220.00 and a low estimate of $115.00. The average target implies an upside of 6.41% from the current price of $157.10. More detailed estimate data can be found on the TKO Group Holdings Inc (TKO) Forecast page.
Based on the consensus recommendation from 19 brokerage firms, TKO Group Holdings Inc's (TKO, Financial) average brokerage recommendation is currently 1.8, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
TKO Key Business Developments
Release Date: February 26, 2025
- Total Revenue (2024): $2.804 billion
- Adjusted EBITDA (2024): $1.251 billion
- Adjusted EBITDA Margin (2024): 45%
- Fourth Quarter Revenue: $642 million
- Fourth Quarter Adjusted EBITDA: $238 million
- Fourth Quarter Adjusted EBITDA Margin: 37%
- UFC Fourth Quarter Revenue: $344 million
- UFC Fourth Quarter Adjusted EBITDA: $178 million
- UFC Fourth Quarter Adjusted EBITDA Margin: 52%
- WWE Fourth Quarter Revenue: $298 million
- WWE Fourth Quarter Adjusted EBITDA: $114 million
- WWE Fourth Quarter Adjusted EBITDA Margin: 38%
- Free Cash Flow (2024): $509 million
- Free Cash Flow Conversion (2024): 41%
- Debt (End of 2024): $2.78 billion
- Cash and Cash Equivalents (End of 2024): $526 million
- 2025 Revenue Guidance: $2.93 billion to $3.0 billion
- 2025 Adjusted EBITDA Guidance: $1.35 billion to $1.39 billion
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- TKO Group Holdings Inc (TKO, Financial) delivered record financial performance in 2024, with revenue of $2.804 billion and adjusted EBITDA of $1.251 billion, exceeding revised guidance.
- The integration of UFC and WWE resulted in greater efficiency and exceeded the guided net savings of $100 million.
- TKO strengthened its media rights portfolio by securing transformative partnerships, such as moving WWE Raw to Netflix, significantly expanding reach and engagement.
- Both UFC and WWE achieved record-breaking years in live events, setting multiple all-time highs for ticket sales, attendance, and gate revenues worldwide.
- Sponsorship revenue for UFC grew 28% and WWE sponsorship revenue increased 20% year-over-year, marking record highs for both.
Negative Points
- WWE segment revenue decreased by 10% in the fourth quarter, primarily due to a short-term domestic rights deal for Raw, impacting revenue and adjusted EBITDA.
- Free cash flow for 2024 was negatively impacted by the first installment payment under the UFC antitrust case settlement and debt transaction costs.
- The 2025 outlook includes a timing-related unfavorable impact of approximately $55 million due to a shift in WWE's premium live events in Saudi Arabia.
- UFC's international events, while increasing revenue, have a lower margin profile compared to Apex events, affecting overall profitability.
- The acquisition of IMG, On Location, and PBR is not yet reflected in the 2025 financial outlook, leaving some uncertainty about future integration impacts.
