TKO GROUP HOLDINGS INC (TKO) Stock Fundamental Analysis
NYSE:TKO - New York Stock Exchange, Inc. - US87256C1018 - Common Stock - Currency: USD
TKO gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 72 industry peers in the Entertainment industry. Both the profitability and the financial health of TKO get a neutral evaluation. Nothing too spectacular is happening here. While showing a medium growth rate, TKO is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
TKO had positive earnings in the past year.
In the past year TKO had a positive cash flow from operations.
In multiple years TKO reported negative net income over the last 5 years.
Of the past 5 years TKO 4 years had a positive operating cash flow.
1.2 Ratios
TKO has a Return On Assets of -0.63%. This is in the better half of the industry: TKO outperforms 63.89% of its industry peers.
TKO's Return On Equity of -2.00% is fine compared to the rest of the industry. TKO outperforms 68.06% of its industry peers.
The Return On Invested Capital of TKO (4.37%) is better than 72.22% of its industry peers.
The Average Return On Invested Capital over the past 3 years for TKO is significantly below the industry average of 22.90%.
The last Return On Invested Capital (4.37%) for TKO is well below the 3 year average (14.73%), which needs to be investigated, but indicates that TKO had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -0.63% | ||
| ROE | -2% | ||
| ROIC | 4.37% |
ROA(3y)9.63%
ROA(5y)9.36%
ROE(3y)28.1%
ROE(5y)29.24%
ROIC(3y)14.73%
ROIC(5y)14.52%
1.3 Margins
TKO has a better Operating Margin (25.88%) than 95.83% of its industry peers.
In the last couple of years the Operating Margin of TKO has grown nicely.
The Gross Margin of TKO (68.42%) is better than 79.17% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 25.88% | ||
| PM (TTM) | N/A | ||
| GM | 68.42% |
OM growth 3Y16.54%
OM growth 5Y23.24%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
TKO has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
There is no outstanding debt for TKO. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
2.2 Solvency
TKO has an Altman-Z score of 2.72. This is not the best score and indicates that TKO is in the grey zone with still only limited risk for bankruptcy at the moment.
TKO's Altman-Z score of 2.72 is fine compared to the rest of the industry. TKO outperforms 69.44% of its industry peers.
The Debt to FCF ratio of TKO is 4.52, which is a neutral value as it means it would take TKO, 4.52 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 4.52, TKO is in the better half of the industry, outperforming 72.22% of the companies in the same industry.
TKO has a Debt/Equity ratio of 0.73. This is a neutral value indicating TKO is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.73, TKO is in line with its industry, outperforming 41.67% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.73 | ||
| Debt/FCF | 4.52 | ||
| Altman-Z | 2.72 |
ROIC/WACC0.49
WACC8.98%
2.3 Liquidity
TKO has a Current Ratio of 0.99. This is a bad value and indicates that TKO is not financially healthy enough and could expect problems in meeting its short term obligations.
TKO has a Current ratio (0.99) which is in line with its industry peers.
A Quick Ratio of 0.99 indicates that TKO may have some problems paying its short term obligations.
With a Quick ratio value of 0.99, TKO perfoms like the industry average, outperforming 55.56% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.99 | ||
| Quick Ratio | 0.99 |
3. Growth
3.1 Past
TKO shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -67.86%.
TKO shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 36.50% yearly.
EPS 1Y (TTM)-67.86%
EPS 3Y22.79%
EPS 5Y36.5%
EPS Q2Q%-77.38%
Revenue 1Y (TTM)N/A
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%101.49%
3.2 Future
TKO is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 11.97% yearly.
The Revenue is expected to grow by 17.99% on average over the next years. This is quite good.
EPS Next Y-26.65%
EPS Next 2Y15.34%
EPS Next 3Y16.3%
EPS Next 5Y11.97%
Revenue Next Year61.65%
Revenue Next 2Y41.78%
Revenue Next 3Y24.61%
Revenue Next 5Y17.99%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 108.40 indicates a quite expensive valuation of TKO.
Based on the Price/Earnings ratio, TKO is valued a bit cheaper than the industry average as 63.89% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of TKO to the average of the S&P500 Index (27.21), we can say TKO is valued expensively.
Based on the Price/Forward Earnings ratio of 33.17, the valuation of TKO can be described as expensive.
Compared to the rest of the industry, the Price/Forward Earnings ratio of TKO indicates a somewhat cheap valuation: TKO is cheaper than 68.06% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of TKO to the average of the S&P500 Index (21.70), we can say TKO is valued expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 108.4 | ||
| Fwd PE | 33.17 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as TKO.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of TKO indicates a somewhat cheap valuation: TKO is cheaper than 61.11% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 53 | ||
| EV/EBITDA | 37.65 |
4.3 Compensation for Growth
TKO's earnings are expected to grow with 16.30% in the coming years. This may justify a more expensive valuation.
PEG (NY)N/A
PEG (5Y)2.97
EPS Next 2Y15.34%
EPS Next 3Y16.3%
5. Dividend
5.1 Amount
TKO has a yearly dividend return of 0.86%, which is pretty low.
TKO's Dividend Yield is rather good when compared to the industry average which is at 6.63. TKO pays more dividend than 84.72% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.42, TKO's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.86% |
5.2 History
TKO has paid a dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
TKO pays out 23.38% of its income as dividend. This is a sustainable payout ratio.
DP23.38%
EPS Next 2Y15.34%
EPS Next 3Y16.3%
175.61
-6.34 (-3.48%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryEntertainment
Earnings (Last)
Earnings (Next)
Inst Owners96.67%
Inst Owner Change3.95%
Ins Owners0.79%
Ins Owner Change0.93%
Market Cap34.75B
Analysts83.33
Price Target183.71 (4.61%)
Short Float %9.51%
Short Ratio6.35
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.86% |
Yearly Dividend0.48
Dividend Growth(5Y)N/A
DP23.38%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)262.92%
Min EPS beat(2)-44.96%
Max EPS beat(2)570.8%
EPS beat(4)2
Avg EPS beat(4)128.16%
Min EPS beat(4)-51.56%
Max EPS beat(4)570.8%
EPS beat(8)4
Avg EPS beat(8)68.07%
EPS beat(12)8
Avg EPS beat(12)53.71%
EPS beat(16)11
Avg EPS beat(16)52.67%
Revenue beat(2)2
Avg Revenue beat(2)1.72%
Min Revenue beat(2)1.51%
Max Revenue beat(2)1.93%
Revenue beat(4)2
Avg Revenue beat(4)-6.61%
Min Revenue beat(4)-27.06%
Max Revenue beat(4)1.93%
Revenue beat(8)5
Avg Revenue beat(8)-2.54%
Revenue beat(12)7
Avg Revenue beat(12)-2.07%
Revenue beat(16)9
Avg Revenue beat(16)-1.5%
PT rev (1m)7.14%
PT rev (3m)7.49%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0%
EPS NY rev (1m)0%
EPS NY rev (3m)0%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 108.4 | ||
| Fwd PE | 33.17 | ||
| P/S | 13.66 | ||
| P/FCF | 53 | ||
| P/OCF | 51.96 | ||
| P/B | 8.71 | ||
| P/tB | N/A | ||
| EV/EBITDA | 37.65 |
EPS(TTM)1.62
EY0.92%
EPS(NY)5.29
Fwd EY3.01%
FCF(TTM)3.31
FCFY1.89%
OCF(TTM)3.38
OCFY1.92%
SpS12.85
BVpS20.17
TBVpS-35.75
PEG (NY)N/A
PEG (5Y)2.97
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -0.63% | ||
| ROE | -2% | ||
| ROCE | 5.5% | ||
| ROIC | 4.37% | ||
| ROICexc | 4.47% | ||
| ROICexgc | 84.04% | ||
| OM | 25.88% | ||
| PM (TTM) | N/A | ||
| GM | 68.42% | ||
| FCFM | 25.78% |
ROA(3y)9.63%
ROA(5y)9.36%
ROE(3y)28.1%
ROE(5y)29.24%
ROIC(3y)14.73%
ROIC(5y)14.52%
ROICexc(3y)24.53%
ROICexc(5y)26.42%
ROICexgc(3y)44.43%
ROICexgc(5y)38.81%
ROCE(3y)22.69%
ROCE(5y)22.64%
ROICexcg growth 3Y11.84%
ROICexcg growth 5Y-0.18%
ROICexc growth 3Y-54.96%
ROICexc growth 5Y-41.05%
OM growth 3Y16.54%
OM growth 5Y23.24%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3YN/A
GM growth 5YN/A
F-Score4
Asset Turnover0.2
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.73 | ||
| Debt/FCF | 4.52 | ||
| Debt/EBITDA | 2.94 | ||
| Cap/Depr | 3.88% | ||
| Cap/Sales | 0.51% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 67.26% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.99 | ||
| Quick Ratio | 0.99 | ||
| Altman-Z | 2.72 |
F-Score4
WACC8.98%
ROIC/WACC0.49
Cap/Depr(3y)96.87%
Cap/Depr(5y)79.58%
Cap/Sales(3y)7.32%
Cap/Sales(5y)6.4%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-67.86%
EPS 3Y22.79%
EPS 5Y36.5%
EPS Q2Q%-77.38%
EPS Next Y-26.65%
EPS Next 2Y15.34%
EPS Next 3Y16.3%
EPS Next 5Y11.97%
Revenue 1Y (TTM)N/A
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%101.49%
Revenue Next Year61.65%
Revenue Next 2Y41.78%
Revenue Next 3Y24.61%
Revenue Next 5Y17.99%
EBIT growth 1Y151.25%
EBIT growth 3Y39.61%
EBIT growth 5Y38.63%
EBIT Next Year54.14%
EBIT Next 3Y36.71%
EBIT Next 5Y27.62%
FCF growth 1Y309.81%
FCF growth 3Y12.83%
FCF growth 5Y22.14%
OCF growth 1Y161.37%
OCF growth 3Y13.55%
OCF growth 5Y20.2%