TKO Group Holdings, Inc. (TKO) $184.40
TKO Group Holdings is sliding fast, down over 18% from its 52-week high and testing critical support as the market questions its premium valuation.
52-wk High $226.94
π Investment Snapshot
- TKO trades at a premium 68.6x P/E following a -10.3% monthly slide.
- Latest Q1 revenue reached $1.60B with EPS of $1.12.
- Unfilled bearish Fair Value Gaps point to overhead resistance near $189.80.
- Consensus target of $234.39 implies significant 27.1% upside potential.
TKO has broken below its key moving averages, signaling a shift in near-term momentum. We prefer to wait for a firmer base to establish near major support before committing new capital.
| π Entry Zone | $180.00 or below | π Stop-Loss | $171.00 |
| π Adjust If | the stock reclaims the 200-day SMA at $196.38 on above-average volume. | ||
The Investment Case β Why Now?
Over the last 90 days, TKO Group has faced a steady correction, shedding 10.3% in the past month alone as momentum cools. While the core live sports entertainment thesis remains robust, the stock’s premium multiple of 68.6x P/E demands flawless execution. Institutional appetite remains healthy, but retail momentum has clearly rotated out of high-beta entertainment names.
The primary risk centers on rising production costs and the integration of WWE and UFC assets under one roof, which could pressure margins if live event attendance softens. With the 10Y Treasury yield sitting at 4.57%, high-multiple growth stocks face compressed valuation ceilings. We believe the current pullback offers a healthier entry window, but patience is required as the technical damage is repaired.
π€ Can TKO maintain its premium valuation if live event margins compress under rising production costs?
π’ Company Overview
| Detail | Value |
|---|---|
| Industry | Entertainment |
| Dividend Yield | 1.69% |
| 52-Week Range | $152.29 – $226.94 |
| Short Interest | 12.8% of float |
Open chart on TradingView β
π Price Action & Technicals
Dead Cross
Inside VA
Buy-side Sweep at $192.64 on 2026-07-06
TKO currently trades at $184.40, slicing cleanly below both its 50-day SMA ($195.53) and 200-day SMA ($196.38) in a decisive bearish crossover.
The RSI of 37.3 indicates growing bearish momentum but has not yet reached the deeply oversold territory (sub-35) required to trigger a high-conviction buy signal. Meanwhile, the MACD sits at -2.2, trailing its signal line of 0.2, which confirms the prevailing downward trend.
Volume Profile analysis reveals the Point of Control (POC) at $201.6, well above current levels, indicating heavy overhead supply that will act as resistance on any rebound. The price is currently trading near the lower boundary of the Value Area ($182.15), a critical zone where buyers must step in to prevent a deeper slide.
Recent liquidity sweeps show institutional activity, including a buy-side sweep at $192.64 on July 6, which failed to spark a sustainable rally. Two unfilled bearish Fair Value Gaps (FVGs) remain open between $189.8~$191.38 and $195.37~$200.76, likely acting as magnets for any short-term relief rallies before sellers re-emerge.
Historically, breaks below the 200-day moving average on below-average volume (currently 89% of the 20-day average) lead to a period of consolidation rather than an immediate V-shaped recovery.
β Peer P/E Comparison
| Ticker | Company | P/E (TTM) |
|---|---|---|
| TKO | TKO Group Holdings, Inc. | 68.6x |
| NFLX | Netflix, Inc. | 38.2x |
| DIS | The Walt Disney Company | 24.5x |
| SPX | S&P 500 Index (Avg) | 22.1x |
π° Earnings Deep Dive
| Period | Revenue | EPS | YoY |
|---|---|---|---|
| Q1 2026 | $1.60B | $1.12 | +22% |
| Q4 2025 | $1.04B | -$0.07 | -5% |
| Q3 2025 | $1.12B | $0.47 | +8% |
| Q2 2025 | $1.31B | $1.17 | +15% |
TKO generated a strong $0.7B in Free Cash Flow last quarter, supporting $0.8B in share buybacks to return capital to shareholders.
Q1 2026 earnings showed stellar top-line growth of 22% YoY, driven by strong live event monetization and international rights fees. However, the market remains hyper-focused on margin sustainability as integration costs linger.
π Growth Drivers β What Moves the Stock
- Global Media Rights Expansion π’ Upside Surprise β Securing lucrative international TV deals for WWE Raw and UFC events globally.
- Live Event Sponsorship Monetization π‘ Priced In β Increasing high-margin sponsorship revenue through integrated brand placements.
- Merchandising and Licensing π‘ Priced In β Capitalizing on global fan engagement through direct-to-consumer e-commerce.
π€ Will international media rights expansion be enough to offset domestic saturation?
π¦ Smart Money & Institutional Positioning
13F Holdings
| Institution | Shares (K) |
|---|---|
| State Street Corporation | 6,410 |
| Blackrock Inc. | 5,314 |
| Morgan Stanley | 5,252 |
| Vanguard Capital Management LLC | 4,174 |
Holdings reflect most recent 13F (45-day lag).
Insider Transactions
| Name | Title | Date | Type | Shares |
|---|---|---|---|---|
| KHAN NICHOLAS | Director | 2026-06-30 | Purchase | 90 |
| KHAN NICHOLAS | Director | 2026-06-12 | Purchase | 9,589 |
| BYNOE PETER C B | Director | 2026-06-10 | Purchase | 1,237 |
Short Interest
| Short % Float | Days to Cover |
|---|---|
| 12.8% | 5.2 |
β Key Risk Factors
~$2.5B market cap impact
~$1.2B revenue impact
π― Guidance & Wall Street View
Management has reiterated its long-term target of high-single-digit organic revenue growth, supported by robust international demand.
| High Target | Mean Target | Low Target | Analysts | Consensus |
|---|---|---|---|---|
| $275.00 | $234.39 | $185.00 | 18 | Buy |
| Firm | Rating | Target | Date | Action |
|---|---|---|---|---|
| BTIG | Buy | $240.00 | 2026-05-07 | Reiterated |
| Morgan Stanley | Overweight | $250.00 | 2026-05-01 | Upgrade |
| Wolfe Research | Peer Perform | $195.00 | 2026-03-05 | Downgrade |
Wall Street remains overwhelmingly bullish with a mean target of $234.39, representing 27.1% upside. However, recent downgrades to Neutral/Peer Perform suggest near-term caution is warranted.
Open chart on TradingView β
π Bull vs Bear β Probability-Weighted Scenarios
π Bull Case
- Strong international media rights renewals surprise to the upside.
- Sponsorship synergies between UFC and WWE exceed expectations.
π Base Case
TKO consolidates near $180 before slowly grinding higher as earnings growth catches up to its valuation.
π» Bear Case
- Higher production costs compress operating margins.
- Macro slowdown impacts live event ticket pricing power.
π― Investor Action Plan β By Profile
Stay on the sidelines until TKO reclaims the 200-day SMA at $196.38 or tests the $180 support level with a bullish RSI divergence.
Avoid adding new capital here. Let the current technical correction play out before building a position near the $180 value area low.
Maintain existing core positions. The long-term fundamental thesis remains intact, backed by strong FCF and institutional backing.
β Investor FAQ β People Also Ask
Q: Why is TKO stock falling despite strong earnings?
The decline is primarily driven by technical momentum and valuation compression, as the stock’s high 68.6x P/E multiple faces pressure from elevated Treasury yields.
Q: What are the key support levels to watch for TKO?
The immediate support lies at the Value Area Low of $182.15, followed by the psychological support level at $180.00.
Q: Is the dividend yield safe?
Yes, TKO’s 1.69% dividend yield is well-supported by its robust $0.7B quarterly Free Cash Flow and strong balance sheet.
π New to these terms? P/E Ratio Β· Free Cash Flow Β· Insider Signals Β· Stop-Loss Β· RSI
π Want to verify if this analysis still holds?
π Disclaimer
This analysis is for informational purposes only and does not constitute investment advice. Goldman Sachs or its affiliates may hold positions in the securities mentioned.
All active positions and their real-time performance are tracked on our Investment Log.
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