Let's face it -- one of the reasons you bought stock in World Wrestling Entertainment
No longer do you care only about what's on the card. You aren't totally focused on whether the Undertaker gets sent to hell by a tombstone, Stone Cold Steve Austin takes a coconut to the head from the rapacious "Rowdy" Roddy Piper, or Stacy Keibler enters the ring wearing next to nothing. These things are still important, but you know what really matters now -- the bottom line.
And when I say "bottom line," in this case I'm talking about pay-per-view buy rates, the essential driver of profitability for this part of WWE's operations. Wrestlemania 21, taking place this Sunday in Los Angeles, has a lot riding on it: If the company can create the perception that storylines intertwined with grappling gladiators once again make for an exceptional form of entertainment worthy of people's time (as well as their discretionary money), the event could serve as a positive catalyst for the company's next cycle.
Mr. McMahon and his marketing machine aren't wasting any opportunity, whether it be Sylvester Stallone helping to induct Hulk Hogan into the company's own hall of fame, organizing a road trip, or scheduling numerous events this week in Hollywood, including school visits, autograph sessions, and video game competitions involving THQ
The big question on everybody's mind is how well all of this is going to work. Is it going to help the company finally come to grips with its future prospects? Rick Munarriz laid out some of the problems that WWE is facing in a recent article. The problems are serious, and they boil down to one essential element: For the company to grow, it needs to regain some of its lost popularity.
I like the creative level that seems to be on hand at this year's Wrestlemania, but I'm no clairvoyant. I couldn't say with certainty that the event will set a chain of events in motion such that the revenues and earnings are going to spike upward like a pretty parabola. The stock's price action has been quite challenged the past few years, although the WWE's issuing of dividends increases the stock's quality as a long-term investment. (And don't forget the great growth opportunity of movies.) Fans who want to say they own a piece of Vince's empire certainly shouldn't be afraid of reserving a small portion of their portfolio to the squared circle.
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You can even talk about the wrasslin' going on with the stock at the Fool's WWE discussion board.
Fool contributor Steven Mallas owns none of the companies mentioned.