TKO Group Holdings (TKO) AI Stock Analysis

• Market Cap: $35.49B
• Dividend Yield: 0.85%
• Average Volume (3M): 940.91K
• Price to Earnings (P/E): 104.1
• Beta (1Y): 0.75
• Revenue Growth: 63.73%
• EPS Growth: N/A
• Country: US
• Employees: 890
• Sector: Communication Services
• Sector Strength: 93
• Industry: Entertainment
• EPS (TTM): 0.69
• Shares Outstanding: 81,747,470
• 10 Day Avg. Volume: 1,221,891
• 30 Day Avg. Volume: 940,909
• PEG Ratio: 0.35
• Price to Book (P/B): 10.02
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 11.65
• Enterprise Value/Market Cap: 0.23
• Enterprise Value/Revenue: 0.72
• Enterprise Value/Gross Profit: 4.00
• Enterprise Value/Ebitda: 2.75
• 1Y Price Target: $193.15
• Price Target Upside: 7.69% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 14

• Rating: 78 Outperform
• Price Target: $205.00 ▲(14.30%Upside)

TKO's strong financial performance and positive guidance from the recent earnings call are key contributors to its high score. Strategic acquisitions bolster its market position, while technical indicators suggest momentum but caution against overvaluation. Despite a high P/E ratio, the stock benefits from strong revenue growth and operational efficiencies.

Positive Factors

Earnings and Financial Performance

TKO reported strong 1Q results, which included the recently acquired Endeavor assets, that beat revenue and adj. EBITDA forecast for both UFC and WWE.

Growth and Expansion

The integration of recently acquired assets is expected to elevate earnings and cash flow growth.

Market Valuation

TKO trades at a substantial discount to its closest competitor despite having an equal-to-better growth profile.

Negative Factors

Corporate Governance

TKO acquired IMG and On Location from Endeavor in a $3.25B all-stock transaction that raised serious governance questions.

Partnerships and Relationships

Reports indicate the relationship between UFC and ESPN has deteriorated in recent years, with frustrations stemming from declining PPV sales, price hikes, and technical issues during events.

Strategic Alignment

The venture targets 12 annual fight cards in addition to large-scale 'super fights' like Canelo vs. Crawford, marking a material expansion outside of UFC’s core focus and raising questions about White’s bandwidth and strategic alignment.

TKO Group Holdings Business Overview & Revenue Model

Company Description

TKO Group Holdings (TKO) is a dynamic sports and entertainment company that operates primarily in the professional wrestling and mixed martial arts sectors. The company is a result of the merger between the Ultimate Fighting Championship (UFC) and World Wrestling Entertainment (WWE), combining the strengths of two of the most prominent organizations in combat sports and sports entertainment. TKO leverages its extensive media rights agreements, live event promotions, and diverse content offerings to engage a global audience.

How the Company Makes Money

TKO Group Holdings primarily generates revenue through multiple streams including media rights, live events, consumer products, and sponsorships. Media rights are a significant revenue source, with the company negotiating lucrative deals with broadcasters and streaming platforms to distribute its content globally. Live events, such as pay-per-view and stadium shows, contribute to earnings through ticket sales and event-related merchandise. TKO also capitalizes on its brand by selling consumer products like apparel and collectibles. Sponsorship and advertising partnerships further enhance its revenue, with brands eager to associate with the company's high-profile events and large fanbase.

TKO Group Holdings Financial Statement Overview

Summary

TKO Group Holdings exhibits a strong financial performance with robust revenue growth and efficient cost management as evidenced by high profit margins. The balance sheet is stable, though there is potential for enhancing shareholder returns and optimizing asset use. Cash flows are a significant strength, with impressive growth and efficiency. Continued focus on improving net profitability and asset utilization could further solidify TKO's financial position in the competitive entertainment industry.

Income Statement

TKO Group Holdings has demonstrated strong revenue growth with the most recent TTM revenue increasing by 22.76% over the previous annual period. The gross profit margin is robust at 60.22%, indicating efficient production and cost management. Additionally, the company achieved a significant net profit margin improvement to 4.99% in the latest TTM. The EBIT margin of 22.52% and EBITDA margin of 32.56% reflect healthy operational efficiency. Overall, the income statement shows a positive trajectory in revenue and profitability, though further improvement in net profitability could enhance the score.

Balance Sheet

The balance sheet reveals a moderate debt-to-equity ratio of 0.74, which suggests a balanced approach to leveraging. With a return on equity (ROE) of 4.12% in the latest TTM, there is room for improvement in generating returns for shareholders. The equity ratio of 27.73% highlights a solid equity base, but increased asset utilization could further strengthen the financial position. While the company maintains a stable balance sheet, optimizing leverage and enhancing shareholder returns could improve its financial health.

Cash Flow

TKO's cash flow statement is favorable, with a strong free cash flow growth rate of 31.93% in the latest TTM. The operating cash flow to net income ratio of 4.00 indicates robust cash generation relative to net income, showcasing operational efficiency. The free cash flow to net income ratio at 3.91 further emphasizes strong cash flow management. While cash flow performance is commendable, maintaining this momentum in the future will be key to sustaining financial flexibility.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	3.44B	2.80B	1.67B	1.14B	1.03B	891.15M
Gross Profit	2.07B	1.90B	1.16B	814.56M	696.34M	623.79M
EBITDA	1.12B	676.31M	611.09M	603.15M	341.40M	292.90M
Net Income	171.65M	9.41M	-35.23M	387.27M	272.34M	177.16M
Balance Sheet
Total Assets	15.01B	12.70B	12.69B	3.58B	4.30B	1.32B
Cash, Cash Equivalents and Short-Term Investments	470.86M	525.56M	235.84M	180.57M	874.69M	593.40M
Total Debt	3.07B	3.04B	3.03B	2.78B	2.85B	719.96M
Total Liabilities	4.82B	3.98B	3.84B	3.01B	3.05B	934.89M
Stockholders Equity	4.16B	4.09B	4.11B	568.92M	1.25B	383.99M
Cash Flow
Free Cash Flow	670.79M	508.46M	419.75M	489.32M	430.10M	329.55M
Operating Cash Flow	686.90M	583.41M	468.38M	501.72M	441.24M	351.24M
Investing Cash Flow	-53.79M	-59.05M	12.28M	-13.26M	-11.48M	-21.93M
Financing Cash Flow	-407.32M	-232.26M	-424.47M	-1.18B	162.51M	-199.61M

TKO Group Holdings Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 179.35
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TKO, the sentiment is Positive. The current price of 179.35 is above the 20-day moving average (MA) of 169.60, above the 50-day MA of 163.57, and above the 200-day MA of 145.31, indicating a bullish trend. The MACD of 4.92 indicates Negative momentum. The RSI at 72.50 is Negative, neither overbought nor oversold. The STOCH value of 93.82 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TKO.

TKO Group Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FOXA	81 Outperform	$24.49B	14.12	16.89%	0.95%	15.70%	26.73%
FOX	80 Outperform	$24.49B	13.02	16.89%	1.03%	15.70%	26.73%
TKO	78 Outperform	$35.49B	104.12	4.19%	0.85%	63.73%	―
DIS	78 Outperform	$219.94B	24.99	8.75%	0.82%	5.33%	431.28%
WMG	64 Neutral	$14.18B	31.61	89.20%	2.65%	-0.91%	-14.87%
Sector *	62 Neutral	€14.48B	-10.57	1.48%	4.02%	2.00%	1.26%
WBD	59 Neutral	$27.96B	―	-27.69%	―	-5.58%	-254.85%

TKO Group Holdings Corporate Events

TKO Group Holdings Elects Directors at Annual Meeting

On June 12, 2025, TKO Group Holdings, Inc. held its annual meeting of stockholders where approximately 96.26% of voting power was represented. During the meeting, twelve directors were elected to hold office until the 2026 annual meeting, and the appointment of KPMG LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2025, was ratified.

The most recent analyst rating on (TKO) stock is a Buy with a $132.00 price target. To see the full list of analyst forecasts on TKO Group Holdings stock, see the TKO Stock Forecast page.

TKO Group Holdings Completes Major Acquisition

On February 28, 2025, TKO Group Holdings completed the acquisition of several businesses, including Professional Bull Riders and various events businesses, for approximately $3.25 billion. This strategic acquisition is expected to significantly impact TKO’s operations by expanding its portfolio and enhancing its market positioning in the sports and entertainment industry.