Please ensure Javascript is enabled for purposes of website accessibility

UFC Parent Endeavor Will IPO Today. Here's What Investors Need to Know.

By Danny Vena - Apr 29, 2021 at 2:06PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Hollywood powerhouse will go public today after last year's scuttled attempt.

While the company isn't necessarily a household name, Endeavor Group Holdings (EDR) is the parent company of several high-profile entities, including the mixed martial arts league Ultimate Fighting Championship (UFC), the William Morris Talent Agency, and the Miss Universe pageant. 

Endeavor is scheduled to begin trading on the New York Stock Exchange today using the ticker "EDR." The stock was priced at $24 at the high-end of the company's range of $22 to $24 per share. The company will offer 21.3 million shares and raise roughly $511 million from the offering. Endeavor will also pocket an additional $1.35 billion from a concurrent private placement with institutional investors. This will value the company at about $6 billion. 

Block tiles with the letters IPO on stacks of coins and a climbing red graph arrow over the letters.

Image source: Getty Images.

The company already has big plans for some of the proceeds. Endeavor currently controls just over 50% of the UFC but will spend $437 million to purchase the remaining part of the league it doesn't already own. 

The year 2020 was a tough one for both the entertainment industry and live sports as the result of the pandemic, which was evident in Endeavor Group's results. For the year ended Dec. 31, 2020, the company reported revenue of $3.48 billion, down 24% year over year. For context, Endeavor delivered 26% growth in 2019. The bottom line suffered as well, as Endeavor generated a net loss of $655 million, worsening from a loss of $554 million in 2019. 

It's also worth noting that Endeavor's balance sheet is loaded down with roughly $5.9 billion in long-term debt and just over $1 billion in cash. The imbalance is the result of several audacious acquisitions over the past decade. This includes the $2.3 billion it paid for the sports, fashion, and event agency IMG in 2014 and the majority stake it acquired in UFC in 2016. 

 

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

EdR Stock Quote
EdR
EDR

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
323%
 
S&P 500 Returns
112%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 07/06/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.