TKO Group Holdings (TKO) AI Stock Analysis

• Market Cap: $37.69B
• Dividend Yield: 0.4%
• Average Volume (3M): 917.10K
• Price to Earnings (P/E): 85.9
• Beta (1Y): 0.80
• Revenue Growth: 53.33%
• EPS Growth: N/A
• Country: US
• Employees: 890
• Sector: Communication Services
• Sector Strength: 96
• Industry: Entertainment
• EPS (TTM): 1.17
• Shares Outstanding: 82,136,890
• 10 Day Avg. Volume: 662,586
• 30 Day Avg. Volume: 917,102
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.18
• Enterprise Value/Revenue: 11.42
• Enterprise Value/Gross Profit: 21.89
• Enterprise Value/Ebitda: 36.84
• 1Y Price Target: $208.38
• Price Target Upside: 9.63% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 15

• Rating: 72 Outperform
• Price Target: $204.00 ▲(7.32% Upside)

TKO Group Holdings scores a 72, driven by strong financial performance and strategic growth initiatives, such as the ESPN and Paramount media rights deals. While the stock shows bullish technical indicators, the high P/E ratio suggests potential overvaluation. The company's robust earnings call and positive corporate events further support its growth trajectory, although caution is advised due to valuation concerns.

Positive Factors

Financial performance

The new rights deal is expected to result in a share price increase for TKO.

Revenue opportunities

The agreement creates additional revenue opportunities through ad inventory across all 43 events, beyond the headline numbers.

Negative Factors

Quarterly performance

Management noted that 3Q performance will be pressured by a lighter UFC numbered event slate, SmackDown format changes reducing WWE’s quarterly media rights revenue.

Revenue decline

UFC’s live events and hospitality revenue declined due to site fee timing/mix, and IMG revenue contracted 4% on lost FA Cup rights.

TKO Group Holdings Business Overview & Revenue Model

Company Description

TKO Group Holdings, Inc. operates as a sports and entertainment company. It operates through four segments: Media and Content, Live Events, Sponsorships, and Consumer Products Licensing. The company produces live events, television programs, and long-form and short-form video content across various platforms, including broadcast, pay television, and streaming, as well as digital and social media across approximately 170 countries. It is involved in the merchandising of video games, apparel, equipment, trading cards, memorabilia, digital goods, and toys, as well as sale of travel packages and tickets. The company engages in the corporate sponsorships and advertising business, which offers sale of in-venue and in-broadcast advertising assets, content product integration, and digital impressions. TKO Group Holdings, Inc. is based in New York, New York. TKO Group Holdings, Inc. is a subsidiary of Endeavor Group Holdings, Inc.

How the Company Makes Money

TKO generates revenue through multiple streams including ticket sales from live events, broadcasting rights for sports leagues, sponsorship and advertising partnerships, and merchandise sales. The company capitalizes on its brand equity by leveraging media rights agreements that allow for broadcasting of its events on various platforms, thus securing significant revenue from both traditional and digital media. Additionally, TKO engages in strategic partnerships with corporations and sponsors that provide financial support in exchange for advertising opportunities and brand visibility during events, further enhancing its revenue generation capabilities.

TKO Group Holdings Financial Statement Overview

Summary

TKO Group Holdings demonstrates strong revenue growth and improved profitability, supported by effective cash flow management. The balance sheet shows a healthier debt-to-equity ratio, but past high leverage levels could pose risks. The company is on a positive trajectory with robust cash generation, but should focus on improving operational efficiency and managing leverage.

Income Statement

TKO Group Holdings has shown a strong revenue growth rate of 13.28% in the TTM, indicating robust top-line expansion. The gross profit margin remains healthy at 61.98%, although it has slightly decreased from previous years. The net profit margin has improved to 5.41% from a low of 0.34% in 2024, reflecting better cost management and profitability. However, the EBIT and EBITDA margins have shown some volatility, suggesting potential operational challenges.

Balance Sheet

The company's debt-to-equity ratio has improved to 0.72 in the TTM, indicating a more balanced capital structure compared to previous years. However, the return on equity has decreased to 5.09%, which may point to less efficient use of equity capital. The equity ratio is stable, suggesting a solid asset base, but the high leverage in past years poses a potential risk.

Cash Flow

TKO Group Holdings has demonstrated strong free cash flow growth of 30.54% in the TTM, highlighting effective cash management. The operating cash flow to net income ratio is 0.58, indicating a good conversion of earnings into cash. The free cash flow to net income ratio exceeds 1, showing that the company generates more cash than its net income, which is a positive sign for liquidity and financial health.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	3.90B	2.80B	1.67B	1.14B	1.10B	974.21M
Gross Profit	2.04B	1.51B	995.75M	754.53M	446.10M	382.11M
EBITDA	1.21B	676.31M	611.09M	603.15M	341.40M	292.90M
Net Income	210.89M	9.41M	-35.23M	387.27M	177.41M	131.77M
Balance Sheet
Total Assets	15.34B	12.70B	12.69B	3.58B	1.22B	1.32B
Cash, Cash Equivalents and Short-Term Investments	858.51M	525.56M	235.84M	180.57M	415.79M	593.40M
Total Debt	3.06B	3.04B	3.03B	2.78B	619.50M	719.96M
Total Liabilities	4.98B	3.98B	3.84B	3.00B	845.44M	934.89M
Stockholders Equity	4.27B	4.09B	4.11B	568.92M	374.66M	383.99M
Cash Flow
Free Cash Flow	875.67M	508.46M	419.75M	489.32M	430.10M	329.55M
Operating Cash Flow	852.41M	583.41M	468.38M	501.72M	441.24M	351.24M
Investing Cash Flow	-60.42M	-59.05M	12.28M	-13.26M	-11.48M	-21.93M
Financing Cash Flow	-378.99M	-232.26M	-424.47M	-1.18B	162.51M	-199.61M

TKO Group Holdings Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 190.08
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

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 190.08 is above the 20-day moving average (MA) of 184.05, above the 50-day MA of 176.16, and above the 200-day MA of 157.89, indicating a bullish trend. The MACD of 4.20 indicates Negative momentum. The RSI at 62.35 is Neutral, neither overbought nor oversold. The STOCH value of 68.18 is Neutral, 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	78 Outperform	$25.92B	12.44	19.96%	0.90%	16.60%	57.39%
TKO	72 Outperform	$37.69B	85.92	5.11%	0.40%	53.33%	―
WMG	71 Outperform	$17.10B	58.63	54.66%	2.20%	1.36%	-45.79%
LYV	68 Neutral	$37.80B	70.79	345.87%	―	-0.39%	108.72%
NWSA	67 Neutral	$17.12B	35.43	5.69%	0.68%	-11.42%	75.42%
WBD	64 Neutral	$28.77B	39.47	2.18%	―	-3.79%	―
Sector *	60 Neutral	$46.28B	4.13	-13.12%	4.13%	1.85%	-42.71%

TKO Group Holdings Corporate Events

TKO Group Announces Major Media Rights Deal

On August 11, 2025, TKO Group Holdings announced a seven-year media rights agreement with Paramount, making it the exclusive distributor of UFC events in the U.S. starting in 2026. The agreement, valued at $1.1 billion annually, will see UFC events streamed on Paramount+ and select events simulcast on CBS. This shift from the Pay-Per-View model aims to increase accessibility and engagement, potentially boosting Paramount+’s subscriber growth. The deal is expected to solidify UFC’s position as a leading global sports asset and provide significant economic benefits for TKO, enhancing opportunities for investors, brand partners, and fans.

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.