Things could get interesting really quickly with this development
The McMahon family owns all the voting stock (which is not the stock that whoever these people are have bought), so I doubt things will get TOO interesting.
Well..the McMahons own control stocking, but that doesn't mean other stockholders don't get a say. Especially, if they sank a lot of money into it. The reality is the stock sank from $31 to $11 in a matter of a month or so. That is not good. It may not get to interesting, but there will be a sacrificial lamb none the less. I heard the original Network Designer or head is already gone, so I am not sure who else it could be. If the estimates are right and they lose $45 million to $52 million, that is huge.
I don't know how things are viewed in the Wall Street world, but a lot of that $340 million was speculation money from the network announcement and over-hyping of TV negotiation changes, so they're basically back to normal now.
I've been really happy with the Network thus far, so I hope they don't take too much out on that. I wish they'd add a bookmarking feature so it's easy to skip around, but am otherwise happy with it. Hopefully, if it goes international, that helps it out more.
That said, I don't know how other companies work, but I do feel like the McMahons sold the Network and their potential TV deal, as if they were hyping wrestling fans and that's probably not a good idea if you don't deliver.
While "Lemelson Capital, LLC" can't vote the current management out directly, the class of stock they own probably entitles them to some legal rights to having the company behave in a fair and reasonable manner. If they purchased any significant amount of shares, then they also can influence management behavior through economic pressure. (Ie if a big shareholder sells, then having a ton of shares go on the market at once would lower the shareprices of the stocks held by other shareholders, and WWE management would want to avoid letting that happen.)
Lemelson Capital incidentally appears to have been around for a couple of years. They're not established enough for them to seem like major financial players, but they appear successful enough to have the potential for some economic influence.
Investment firms and Wall Street; two things that nobody would miss if they all disappeared tomorrow. Vince should tell them to take a long walk off a short pier and go about his business like nothing is wrong.
OK, to use real numbers now that I have time to grab them...
Originally posted in the most recent Quarterly Report (ir.corporate.wwe.com)At April 30, 2014 the number of shares outstanding of the Registrant’s Class A common stock, par value $.01 per share, was 32,856,521 and the number of shares outstanding of the Registrant’s Class B common stock, par value $.01 per share, was 42,298,437.
Class A stock is the stuff you and I could trade and gets one vote per share.
Class B stock is the stuff only a McMahon can own (if it trades outside the family, it converts to Class A stock, share for share) and it gets TEN votes for share.
This means the McMahons have almost 13x the votes of ALL of the Class A holders...or 92-93% of the total votes. (Vince alone accounts for something like 80%, I believe, although I think he'd shifted some to Linda in 2013.)
Anyway. For this company to claim they now have a stake in WWE is to use a rather broad definition of "stake" - as they would need to have bought over 4½ million shares (almost 15% of outstanding Class A shares!) just to control 1% of any vote. In a sense, this story is comparable to if FLEA were to pick up a few hundred shares and then issue a press release demanding a change in management. (Actually...anybody *seen* FLEA lately?)
But it gives everybody something to talk about! And Monday should be interesting if only to see which face Vince puts on. (Also, my math could be wrong, so please correct me if so)
Then, for the "too long; didn't read" crowd, there's this:
The following factors, among others, could cause actual results to differ materially from those contained in forward-looking statements made in this Form 10-Q, in press releases and in oral statements made by our authorized officers: ... (xxii) through his beneficial ownership of a substantial majority of our Class B common stock, our controlling stockholder, Vincent K. McMahon, can exercise control over our affairs, and his interests may conflict with the holders of our Class A common stock...
Originally posted by wannaberockstarInvestment firms and Wall Street; two things that nobody would miss if they all disappeared tomorrow. Vince should tell them to take a long walk off a short pier and go about his business like nothing is wrong.
Sorta with you on Investment firms and Hedge funds, but Wall St. No fucking way. As much as everyone hates Wall Street, without it, we would be in Mad Max.
Here is the thing, no one said to Vince, you have to make the company public. He did it while the fire was hot coming out of the 90s to pretty much secure his future as well as invest in future projects. How much of it was to combat WCW or to buy WCW and XFL who knows? He was smart enough to make sure no one could out vote him. Even if there is a massive stockholder revolt as CRZ as pointed out, he won't be thrown out and neither will the family. However, it doesn't mean he can do whatever he wants. The stock could be so devalued that its basically toilet paper. Wall St. may see that it is toilet paper if Vince goes full Willy Wonka and says "You get nothing, Good Day, Sir."
I don't think he will. Someone will lose their job though and there will be changes to the Network. I don't bookmarks are going to make any difference. I think they will either raise the price of the Network and/or state they are going to do a special where they add a Saturday Nights Main Event or Clash of Champions as an extra PPV, you won't get anywhere else and then pack like its a Wrestlemania in the summer.
The Network was a giant risk, but the WWE played it up like it was as easy as slice bread. They also presented a bunch of numbers that never really added up to the subscriber bas as well as what they were going to get in the TV deal. Yet, they still ran with them thus the stock went through the roof. They brought a lot of this on themselves. Minus the hype, there is the fan point of view. They had shitty build to Mania. Some fans were leery of buying Mania when there was no PPV to test it out to see if it worked on their device. Its a perfect storm of outside and inside factors.
CRZ is probably right. Nothing will change. Yet, if I am in the back right now, I should at least be concerned what Vince creatively is going to do to spice things up. Do they dump PG or spend more money on free agents that are past their prime or do they just buy TNA. Whatever Vince does or does not do, I am sure he will not be in the best of moods come Monday Night.
Originally posted by lotjxI don't think he will. Someone will lose their job though and there will be changes to the Network. I don't bookmarks are going to make any difference. I think they will either raise the price of the Network and/or state they are going to do a special where they add a Saturday Nights Main Event or Clash of Champions as an extra PPV, you won't get anywhere else and then pack like its a Wrestlemania in the summer.
Bookmarks aren't going to make a difference at all, but my overall point is that the WWE Network is about as good as it can be. The only real things it's missing are additional archive content (AWA, Nitro archives, SNME) and improved user functionality (such as bookmarks and better chapter-skipping).
The content is there, the stream is awesome, it's mostly easy to use, and while not the numbers they projected, they still have a lot of people on it.
Any changes they make like jacking the price (unless you're grandfathered in to the current rate) are going to drive people away if they do it too soon and too much. Maybe in 2015, they can get away with it for new customers, but if they're having trouble getting subscribers now with a cheap product that's pretty damn good (except for bookmarks), they have to be careful what they do with it to maximize profits. If there are any.
It's hard to think that anything will actually change, but with a big lack of PPV revenue this year, it's going to be interesting to see how the monthly major shows change. Overall, though, everything is back to the status quo before the Network debuted. Except there's no network debut, or big growth project, to look forward to.
Originally posted by lotjxI don't think he will. Someone will lose their job though and there will be changes to the Network. I don't bookmarks are going to make any difference. I think they will either raise the price of the Network and/or state they are going to do a special where they add a Saturday Nights Main Event or Clash of Champions as an extra PPV, you won't get anywhere else and then pack like its a Wrestlemania in the summer.
Bookmarks aren't going to make a difference at all, but my overall point is that the WWE Network is about as good as it can be. The only real things it's missing are additional archive content (AWA, Nitro archives, SNME) and improved user functionality (such as bookmarks and better chapter-skipping).
The content is there, the stream is awesome, it's mostly easy to use, and while not the numbers they projected, they still have a lot of people on it.
(edited by SKLOKAZOID on 16.5.14 1946)
In the scheme of things, they don't have a lot of people signed up for this. Their audience is between 4 to 5 million people. They have 750,000 people. That is not even a quarter of their audience which is what they were hoping to get. Now, maybe at the end of the year, they will get it when they open it up to other countries. Until then Wall Street wants to see them make more money or at least cut the cost of the network. If they don't then the stock will continue to fall and there is also the investigation about inflated the price was. You can say how good your company is doing, but you can't make up numbers that so out of touch that it inflates the price.
lotjx, you realize that the people causing all this kerfuffle are doing it to drive the price down because they bought it on a long put?
tl:dr Stockbrokers are assholes
"Tattoos are the mullets of the aughts." - Mike Naimark
"Don't stop after beating the swords into ploughshares, don't stop! Go on beating and make musical instruments out of them. Whoever wants to make war again will have to turn them into ploughshares first" - Yehuda Amichai
Kind of seems like they got what they deserved. Vince has always, at heart, been a carny. Seeing him in any mainstream media capacity where he's challenged instead of grovelled to is proof enough of that. They've lied about their numbers for years, counting all hours of RAW and all hours of Smackdown separately to jack up their viewership numbers to some absurd figure. That this tactic tricked both major American political parties and some of the more gullible news publications for as long as it did is in retrospect more sad than funny.
But math is true whether you believe in it or not.
How do you get around these factors? For one, their audience isn't that big to begin with. Second, that audience is below average in education and household income, making it massively unattractive to advertisers. Third, that they were counting households with an "affinity" for them as a probable subscriber base, likely to spend $120 a year. Four, that they are cannibalizing their PPV revenue to get their network going. Lesser PPVs were obviously not big successes but they were not yet money losers. Five, that they are comparing themselves to sports to grab at big TV licensing deals when for years now, they've been banging the drum of "we're entertainment". I wouldn't buy this stock if you paid me. Which they would.
How do toy sales figure in? They have sizable areas in the toy section at Target and Wal-Mart. They have literally their own aisle at my local Toys R Us. Even the Star Wars and Marvel toys don't have the same level of representation.
"To be the man, you gotta beat demands." -- The Lovely Mrs. Tracker
Originally posted by Matt TrackerHow do toy sales figure in? They have sizable areas in the toy section at Target and Wal-Mart. They have literally their own aisle at my local Toys R Us. Even the Star Wars and Marvel toys don't have the same level of representation.
I would say not as much as you think. You have to realize Mattel is probably making the real profit off of that. Most of the time properties just lease the license. I would expect the WWE does get some extra profit on the sales on top of the licensing.
Foley is going off on twitter about buying WWE stock, but Hogan's Dad is right, this stock is utterly worthless to some extant. There is now another firm looking into the SEC violations too.
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