In a recent Facebook blog, lovable hardcore legend turned embittered wrestling philosopher Mick Foley weighed in on the disastrous decline of WWE's stock. Foley theorized WWE's on-air authority figures may be to blame for the promotion's ongoing Wall Street woes.
Could it be - following the precipitous tumble of WWE stock, that having real life WWE Chief Operating Officer Paul Levesque and Chief Brand Officer Stephanie McMahon performing simultaneous duties as the on-air "Autohority" (sic) is simply not best for business.
Foley then put on his investor hat, admitting he himself had become a shareholder. He questioned whether booking Stephanie McMahon and Triple H as authority figures was hurting WWE's stock:
I've heard from reliable sources that the WWE Network hasn't yet met its initial goals, and that the recent TV deal signed with USA Network wasn't as lucrative as investors had hoped. But there has to be something more - probably alot (sic) of little things. Might one of those things be the blurred line between the real life McMahon-Levesques and the [characters] of Triple H - WWE Universe and Stephanie McMahon - WWE they portray?
Foley started out on the right track with this batch of analysis, but then he started doing too much. WWE's stock surge and subsequent decline was driven by Vince McMahon in real life. Ironically, Vince hasn't appeared in character on WWE programming for the entire year.
Ever the promoter, Vince McMahon's bullishness regarding key business milestones is what led to the surge of WWE's stock in 2014. Poised at just over $16 per share to begin the year, WWE's stock almost doubled ahead of two game-changing announcements.
Reality Vince channeled his boisterous Mr. McMahon character with optimism that almost seems delusional in hindsight.
During a third-quarter-earnings call with investors (per James Caldwell of PWTorch), McMahon boldly (read: infamously) predicted to "double or triple" 2012 earnings by 2015. This was prior to the launch of the WWE Network and the announcement of their television rights deal.
The possibilities had investors salivating.
But when WWE's initial subscription count was announced it came in well below the one million subscribers some analysts predicted (per Wrestling Observer Newsletter via WrestlingInc). WWE's failure to double or triple its current television rights deal called for a revised business outlook.
And with WWE now projected to report losses of $45 to 52 million in 2014 (per Maggie McGrath of Forbes), the outlook is grim.
The result was a stock implosion for the ages, which had everything to do with boardroom hubris and nothing to do with onscreen drama.
Per James Caldwell of the PWTorch, here's a breakdown of WWE's stock performance in 2014:
- Jan. 2: WWE stock opens the year at $16.55 per share.
- Jan. 22: WWE crosses $20 to a closing price of $20.38 per share.
- Jan. 23 - Feb 28: WWE hovers in the mid-$20 range.
- Mar. 4: WWE stock suddenly surges to $26.24 per share.
- Mar. 10: WWE crosses $30 to a closing price of $30.09 per share.
- Mar. 13: WWE hits an all-time high of $31.98 per share.
- Mar. 25: WWE crosses back under $30 to $29.71 per share.
- Mar. 26: WWE drops to $27.53 per share.
- Apr. 4: The Friday before WrestleMania, WWE settles at $28.02 per share.
- Apr. 7: WWE drops 15 percent to $23.90 the day after WrestleMania and the day WWE reported an initial Network subscriber count.
- Apr. 8: WWE drops 7 percent to $22.24, putting the stock back in January territory.
- Apr. 10: WWE drops to $21.12 after receiving "over-valued" evaluation.
- Apr. 11: WWE closes post-WrestleMania Week at $20.29 after falling below the $20-mark at $19.63 per share.
- Apr. 14: WWE closes below $20 for the first time in nearly three months, dating back to Jan. 21.
- Apr. 15: WWE returns above $20 at $20.74 per share on a "buy" recommendation.
- Apr. 16: WWE increased 5.8 percent to $21.97 on favorable reception to WM30 business figures.
- May 2: Stock Price falls to four-month low $18.28 day after WWE reported First Quarter 2014 earnings.
- May 9: Stock Price sets a new four-month low at $17.14 per share, returning to early January levels.
- May 15: Stock Price returns above $20-per-share to $20.65, then closes at $19.93.
- May 15 after-hours: Stock Price plummets to $15.80-per-share following TV renewal with NBC Universal and revised business outlook predicting 2014 net loss.
According to Yahoo! Finance, WWE's stock was valued at $11.77 per share as of May 23, meaning it has returned to a familiar threshold.
NASDAQ listed WWE's stock as hovering around $10 per share throughout 2013. In August of that year, Triple H turned heel in the main event of SummerSlam, rendering one of WWE's top executives a (kayfabe) corrupt villain.
Still, the stock remained virtually unchanged.
The share price was similarly irreverent to WWE's biggest storyline of the year, where (kayfabe) tainted executives Triple H and principal owner Stephanie McMahon feuded with antihero Daniel Bryan.
Prior to a spectacular entrance on that show, Triple H was once again announced by Stephanie as "the most powerful man in WWE" (per James Caldwell of PWTorch). If investors truly believed Triple H had supplanted Vince McMahon based on that tag line, WWE's stock would have free-fallen well before the television rights deal.
But by April 7, the day after WrestleMania XXX where the Authority's on-air efforts failed, WWE's stock clocked in at a healthy $23.90. The amount did reflect a drop in price, but it was only in reaction to WWE Network's disappointing subscriber count in real life, which had been released that day.
In fact, that two-day period is a perfect example of WWE investors understanding the difference between work and shoot announcements from authority figures.
Shareholders don't take Triple H seriously as a crooked executive. If they did, this would have been reflected through a sharp decline of WWE's stock price. When the price did eventually plummet last week, it was because investors had been swerved by the most powerful man in the WWE in real life.
Those who own WWE stock, which admittedly includes well-versed pundits like Foley, can tell the difference between storylines and subscribers.
If Foley's proposition is tweaked, it raises a question that could incite panic among WWE shareholders: Could it be—following the precipitous tumble of WWE stock—Vince McMahon, and his real-world delusions of grandeur rife with bold predictions behind the scenes, is bad for business?