Investment Experts recommend everyone to NOT invest in WWE stocks; criticize WWE's Creative

Investment experts Brandon Ross, Richard Greenfield, and Mark Kelley of technology, media, and telecommunications research firm, Lightshed Partners have released a report, criticizing WWE's creative process. The report takes a detailed look at the ratings of WWE RAW, SmackDown, and NXT and how the decision from WWE management is affecting its stocks.

While the ongoing pandemic of COVID-19 has created several issues, the report mentions that it is not the only reason and recommends that no one should invest in WWE stocks at the moment, which should be a sign of worry for WWE Chairman, Vince McMahon.

Investment Experts slam WWE's creative process

In the last month, the ratings of WWE's flagship shows Monday Night RAW and Friday Night SmackDown have been extremely poor. The red brand of WWE is especially suffering badly, recording the lowest ratings in its history recently.

At the end of the day, the company eats on its Raw and SmackDown television contracts. The domestic renewals for Raw and SmackDown were a financial game-changer for the company. And the reason the stock crumbled is because international deals did not follow the same trajectory and came in net down from the last round – despite the gaudy social media figures.

The report further mentions that the situation is not changing anytime soon. They then compare the ratings of RAW and SmackDown to those of NXT and AEW, who have been doing relatively better.

COVID-19 has clearly compounded the problem. We absolutely do not want to minimize the impact from COVID. WWE is reaction entertainment and no live audience hurts. A look at the ratings across AEW, NXT, Raw and SmackDown shows all were impacted negatively by the virus.

That being said, AEW and NXT ratings have actually been climbing back. In July, AEW was up 11% versus April on average. NXT has notably improved against both March and April in the past two months. Meanwhile, both Raw and SmackDown have taken another leg down in the past month, with Raw down 10% and SmackDown down 8% compared to the prior month and both down 15% compared to April.

Understanding seasonality in the WWE calendar, we looked at the ratings in terms of year-over-year declines. In July, Raw ratings have been down 37% and SmackDown down 6% (even with SmackDown’s move to Fox broadcast). Of note, Raw viewership has made fresh all-time lows multiple times this summer.

The experts then mention that the ratings will likely decline further as the NBA will be coming back on Thursday. They went on to say that WWE's time with minimum live competition is coming to an end, which could further hurt the ratings. The report then criticizes the creative process and the lack of new Superstars that Vince McMahon has created.

COVID or no COVID, creative appears to be at the center of the issues. Vince McMahon has acknowledged things need to change multiple times. However, while there have been short lived experiments, the content appears to continuously return to a similar formula under his absolute control.

McMahon went so far as to hire creative heads for Raw and SmackDown a year ago, with Paul Heyman heading Raw and Eric Bischoff heading SmackDown. Neither are in their roles a year later. Bischoff was fired after four months on the job and Heyman was relieved last month. The role is now consolidated under Bruce Prichard.

The report also mentions that while WWE RAW and SmackDown are managing to beat the competition, the poor ratings for the shows might not attract big TV deals in the future.

Stay tuned to Sportskeeda for further news and updates!