Head-To-Head Analysis: World Wrestling Entertainment (WWE) versus Viacom (VIA)
World Wrestling Entertainment (NYSE: WWE) and Viacom (NASDAQ:VIA) are both consumer discretionary companies, but which is the superior stock? We will contrast the two companies based on the strength of their earnings, risk, analyst recommendations, dividends, valuation, profitability and institutional ownership.
This table compares World Wrestling Entertainment and Viacom’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|World Wrestling Entertainment||3.29%||13.07%||5.51%|
Risk & Volatility
World Wrestling Entertainment has a beta of 0.84, indicating that its share price is 16% less volatile than the S&P 500. Comparatively, Viacom has a beta of 1.44, indicating that its share price is 44% more volatile than the S&P 500.
Valuation and Earnings
This table compares World Wrestling Entertainment and Viacom’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|World Wrestling Entertainment||$762.15 million||2.36||$81.40 million||$0.31||75.13|
|Viacom||$13.17 billion||1.04||$2.92 billion||$3.64||9.33|
Viacom has higher revenue and earnings than World Wrestling Entertainment. Viacom is trading at a lower price-to-earnings ratio than World Wrestling Entertainment, indicating that it is currently the more affordable of the two stocks.
World Wrestling Entertainment pays an annual dividend of $0.48 per share and has a dividend yield of 2.1%. Viacom pays an annual dividend of $0.80 per share and has a dividend yield of 2.4%. World Wrestling Entertainment pays out 154.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Viacom pays out 22.0% of its earnings in the form of a dividend. Viacom is clearly the better dividend stock, given its higher yield and lower payout ratio.
Institutional & Insider Ownership
49.5% of World Wrestling Entertainment shares are held by institutional investors. Comparatively, 2.3% of Viacom shares are held by institutional investors. 49.8% of World Wrestling Entertainment shares are held by insiders. Comparatively, 0.7% of Viacom shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.
This is a summary of recent ratings and target prices for World Wrestling Entertainment and Viacom, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|World Wrestling Entertainment||1||2||6||0||2.56|
World Wrestling Entertainment currently has a consensus target price of $24.43, indicating a potential upside of 4.89%. Viacom has a consensus target price of $42.86, indicating a potential upside of 26.24%. Given Viacom’s higher possible upside, analysts plainly believe Viacom is more favorable than World Wrestling Entertainment.
Viacom beats World Wrestling Entertainment on 10 of the 16 factors compared between the two stocks.
World Wrestling Entertainment Company Profile
World Wrestling Entertainment, Inc. (WWE) is an integrated media and entertainment company. The Company’s segments are Network, Television, Home Entertainment, Digital Media, Live Events, Licensing, Venue Merchandise, WWEShop, WWE Studios, and Corporate and Other. The Company is engaged in the production and distribution of content through various channels, including its WWE Network, television rights agreements, pay-per-view event programming, live events, feature films, licensing of various WWE themed products, and the sale of consumer products featuring its brands. Its Network, Television, Home Entertainment and Digital Media are individual segments that comprise the Media Division. Its Live Events, Licensing, Venue Merchandise and WWEShop are individual segments that comprise the Consumer Products Division. Its Network segment consists of subscriptions to WWE Network. The Company’s Television segment consists of television rights fees and advertising.
Viacom Company Profile
Viacom Inc. offers global media brands that create television programs, motion pictures, short-form content, applications, games, consumer products, social media experiences and other entertainment content. As of September 30, 2016, the Company offered its services for audiences in more than 180 countries. The Company operates through two segments: Media Networks and Filmed Entertainment. The Media Networks segment creates, acquires and distributes programming and other content for audiences The Media Networks segment provides entertainment content and related branded products for advertisers, content distributors and retailers. The Filmed Entertainment segment produces, finances, acquires and distributes motion pictures, television programming and other entertainment content under the Paramount Pictures, Paramount Vantage, Paramount Classics, Paramount Animation, Insurge Pictures, Nickelodeon Movies, MTV Films and Paramount Television brands.
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