World Wrestling Entertainment, Inc. (NYSE:WWE) is a company with exceptional fundamental characteristics. Upon building up an investment case for a stock, we should look at various aspects. In the case of WWE, it is a financially-sound company with a strong track record and an optimistic future outlook. Below, I’ve touched on some key aspects you should know on a high level. For those interested in understanding where the figures come from and want to see the analysis, read the full report on World Wrestling Entertainment here.
Solid track record with high growth potential
One reason why investors are attracted to WWE is its earnings growth potential in the near future of 30% underlying the notable 43% return on equity over the next few years leading up to 2022. Over the past few years, WWE has demonstrated a proven ability to generate robust returns of 24%. Unsurprisingly, WWE surpassed the Entertainment industry return of 15%, which gives us more confidence of the company’s capacity to drive earnings going forward.
WWE is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This indicates that WWE has sufficient cash flows and proper cash management in place, which is a crucial insight into the health of the company. WWE appears to have made good use of debt, producing operating cash levels of 0.48x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated.
For World Wrestling Entertainment, there are three fundamental factors you should further research:
- Valuation: What is WWE worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether WWE is currently mispriced by the market.
- Dividend Income vs Capital Gains: Does WWE return gains to shareholders through reinvesting in itself and growing earnings, or redistribute a decent portion of earnings as dividends? Our historical dividend yield visualization quickly tells you what your can expect from WWE as an investment.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of WWE? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.