TKO Holdings (TKO), an active long for Hedgeye’s Communications team, is up 15% today following news of Netflix’s 10-year, $5 billion deal to acquire the rights to WWE Raw.
“It’s a really big deal, and it’s why we moved on the stock when we did toward the end of last year because we saw this catalyst coming,” Comms analyst Andrew Freedman explains in this clip from The Call @ Hedgeye.
“This is far above any expectations that anyone on the Street, but us, had,” adds Billy Zegras.
After a brief, pre-market pop, Netflix (NFLX) stock price came back down to earth. Netflix remains the Comms team’s #1 short call ahead of today’s quarterly earnings report.
“The way a wily veteran would read them putting out this announcement before Netflix reports is that they’re trying to give you good news ahead of bad news,” says CEO Keith McCullough. “The timing of this … they get to decide. It’s not random.”
FYI—our Communications research team hosted an in-depth discussion on TKO today. Subscribe to Communications Pro for more insights on this company, Netflix and the sector as a whole.
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