TKO Group Holdings heads into its May 6 Q1 print with the Street freshly turning more constructive — even as the stock has pulled back nearly 8% over the past month to $185.95.
The most pointed signal comes from the analyst community. Morgan Stanley upgraded TKO to Overweight from Equal-Weight on May 1, lifting its target to $225, just days before earnings. That move is significant: it follows a pattern of cautious trimming from other firms, with Bernstein cutting its target to $240 from $250 last week while holding Outperform. The consensus target of $236 implies roughly 27% upside from current levels — a gap that reflects genuine disagreement about whether the stock's recent weakness is an opportunity or a warning. The overall rating sits at Hold, with five holds against three outperforms, suggesting the Street is selectively constructive rather than broadly bullish.
The bull case rests on TKO's pricing power. UFC and WWE's media rights command premium valuations, a captive audience underpins sponsorship monetisation, and the company has laid out a path to $1 billion in partnership revenue by 2030. Free cash flow from operations ran at $1.32 billion on the latest read, supporting dividends and buybacks. Bears counter with execution risk: 2026 revenue guidance could disappoint if marquee events deliver limited incremental revenue — the White House fight was cited as more marketing than money — and rising fighter pay alongside international expansion costs threaten margins. The EV/EBITDA multiple of roughly 10x trailing reflects a stock that has already de-rated from earlier-year highs, with the P/E compressing by more than 8 points over the past month alone.
Short positioning tells a more nuanced story. Short interest is elevated at nearly 11.7% of the free float, but it has been falling steadily — down roughly 9% over the past month and over 3.8% in the past week. The ORTEX short score of 66 places TKO in the upper tier of short interest pressure, but the trend is moving in the bulls' direction. Borrow costs remain minimal at 0.51% annually, and availability is comfortable, so there is no squeeze tension building in the lending market. The options picture has flipped dramatically: the put/call ratio has collapsed to 0.42, well below its 20-day average of 1.22, and near the 52-week low of 0.27. That shift — from extreme put-buying in early April to call-dominated flow now — reflects a market leaning into potential upside rather than hedging against a miss.
Past earnings reactions at TKO have been consistently positive. The February 2026 print produced a one-day gain of around 6.9% and extended to roughly 3.3% over five days. The Q3 2025 release moved the stock up more than 8% on the day. The question for Wednesday's release is whether the company's commentary on 2026 revenue trajectory and margin direction can justify the 27% implied upside that bulls are pricing in — and whether the White House fight was an anomaly or a sign of event-mix pressure to come.
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