TKO changes

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View the full Nov 12, 2026 version

Price: $199.50
Discount category: Pricey
Intrinsic value source: AI estimate
Next earnings: Feb 24, 2027
Next earnings is estimate: Yes
Company name: added: TKO Group
Sector: added: Sports & entertainment media
About: added: TKO Group Holdings, Inc. (TKO) owns the UFC, WWE and IMG, which includes On Location, and Professional Bull Riders (PBR). It is based in New York. It earns revenue from media rights, live events and hospitality, partnerships and marketing, and consumer products. It has three segments: UFC, WWE and IMG, and a Corporate and Other group. In Q3 2026, revenue was $1.360 billion, of which UFC gave $519.2 million, WWE $399.3 million and IMG $391.3 million. Adjusted EBITDA was $555.7 million. TKO is the managing member of TKO Operating Company, LLC (TKO OpCo), which holds the business. At September 30, 2026, TKO owned 38.5% of TKO OpCo. Other members hold the rest as TKO OpCo units, each with one share of Class B common stock. Silver Lake controls TKO through its ownership of Endeavor. The Class A shares trade on the New York Stock Exchange in US dollars.
Thesis: added: The market prices TKO close to the AI estimate, and it must decide how much of the 2026 growth repeats. UFC revenue rose 60% in Q3 2026 to $519.2 million, mostly from the new media rights agreement with Skydance that began in January 2026, two more events and a record UFC 329. IMG Adjusted EBITDA rose to $115.9 million with FIFA World Cup 2026 hospitality at On Location. A part of this growth does not repeat in 2027. TKO also borrows to return cash. It priced $1.0 billion of new senior secured notes on November 5, 2026, and it plans to buy back the rest of its $936.0 million authorization with debt and cash. UFC also faces antitrust suits, and one of them covers Paramount+ subscribers. For the price to stay close to the AI estimate, three things must be true. Adjusted EBITDA for 2027 must stay above the guided $2.295 billion to $2.315 billion for 2026. The media rights agreements, which the company says lock in most revenue for five to seven years, must keep their price steps. Debt must stay in line with the growth of Adjusted EBITDA. The next tests are the Q4 2026 events, including those in the Middle East, and the Q4 2026 report with 2027 guidance in February 2027.
Valuation: added: The intrinsic value for TKO Group is an AI estimate from November 12, 2026. It is not an analyst's value. An AI research agent calculated it from the filings of TKO with the SEC. The method is a multiple of Adjusted EBITDA for 2027, less net debt and redeemable non-controlling interests, divided by the number of Class A shares plus the TKO OpCo units. Adjusted EBITDA is the own measure of TKO. It is the profit of all of TKO OpCo, so the share count must include the units that other members hold. The multiples are assumptions that allow for interest, tax, capital spending and the long term of the media rights agreements. The Q3 2026 release (8-K, November 4, 2026) gives Adjusted EBITDA of $555.7 million for Q3 and $1,755.4 million for nine months, and 2026 guidance of Adjusted EBITDA of $2.295 billion to $2.315 billion and revenue of $5.790 billion to $5.830 billion. It gives cash of $630.9 million and gross debt of $4.647 billion at September 30, 2026. The Form 10-Q for the quarter ended September 30, 2026 gives redeemable non-controlling interests of $34.4 million, 72,440,231 Class A shares and 116,158,615 Class B shares at October 30, 2026, and diluted weighted shares of 74.2 million for Q3, against basic shares of 73.1 million. TKO OpCo units, with an equal number of Class B shares, can be exchanged one for one for Class A shares, so the estimate counts them as shares. The count is 72.44 million plus 116.16 million plus 1.05 million for dilution, or 189.65 million. TKO owned 38.5% of TKO OpCo at September 30, 2026. A count of Class A shares alone would give the holders of Class A shares all of the profit of TKO OpCo, and it would overstate the value of each share. The estimate leaves out the $1.0 billion of notes priced on November 5, 2026 and the planned repurchases, because buying shares near their value changes little. The net amount taken off is $4,050.5 million, which is $4,647.0 million of debt and $34.4 million of redeemable interests, less $630.9 million of cash. The Adjusted EBITDA for 2027 and the multiples are assumptions. The low case assumes $2,300 million, about the same as 2026, because the one-time events do not repeat, at 13.0 times. It gives $136.30 per share. The base case assumes $2,550 million, which is about 11% above the middle of the 2026 guidance, because media rights fees step up, at 15.5 times. It gives $187.05 per share. The high case assumes $2,800 million, because live events and partnerships grow fast, at 18.0 times. It gives $244.39 per share. The estimate assumes weights of 25%, 50% and 25%. The weighted intrinsic value is $188.70 per share. As of Nov 12, 2026.
Risks: added: Part of the 2026 growth does not repeat. FIFA World Cup 2026 hospitality at On Location and the record UFC 329 lifted Q3 2026. Revenue for 2027 must grow from this higher base. Antitrust and legal cases can cost money. Plaintiffs in suits against Zuffa claim that UFC pay-per-view and Paramount+ prices are too high under the Sherman Act, and WWE has legal proceedings that follow the investigation of its former chief executive. Debt rises with buybacks. Gross debt was $4.647 billion at September 30, 2026, and the company priced $1.0 billion of new notes on November 5, 2026 and plans to use debt and cash for repurchases. Net interest expense was $201.1 million for nine months. A few media partners give a large share of revenue. UFC media rights, production and content revenue was $933.3 million for nine months, and WWE gave $897.2 million. Guidance assumes all live events happen as planned, including those in the Middle East. A cancelled event cuts revenue and profit. A controlling holder decides many matters. Silver Lake and its affiliates held about 61% of the voting securities after the take-private of Endeavor.
Balance sheet: added: At September 30, 2026, TKO had cash and cash equivalents of $630.9 million and gross debt of $4.647 billion, which is net debt of about $4.0 billion. Total debt, net of discounts and issuance costs, was $4,618.0 million, against $3,762.1 million at December 31, 2025. Almost all of it is the first lien term loan, due in November 2031. Free cash flow was $449.9 million in Q3 2026. Net interest expense was $201.1 million for nine months. TKO also has redeemable non-controlling interests of $34.4 million. On November 5, 2026, after the balance sheet date, a TKO subsidiary priced $1.0 billion of senior secured notes due 2031. In nine months of 2026, the company returned more than $1.6 billion to equity holders through share repurchases and dividends and related distributions. As of Sep 30, 2026.
Checkpoints: added: Q4 2026 (estimate): Q4 2026 events held as planned. Pending. Watch: TKO stages all live events, including those in the Middle East, and Adjusted EBITDA for 2026 lands in the guided range of $2.295 billion to $2.315 billion, and this passes; a cancelled event or a miss fails. Feb 24, 2027 (estimate): Q4 2026 results and 2027 guidance. Pending. Watch: Guidance for 2027 Adjusted EBITDA is above the 2026 range, and this passes; a guide below it fails.
Recent events: added: Nov 6, 2026: TKO reported to the SEC that its indirect subsidiary TKO Worldwide Holdings, LLC priced an offering of $1.0 billion of Senior Secured Notes due 2031 on November 5, 2026. Nov 4, 2026: TKO reported Q3 2026 results. Revenue was $1.360 billion, up 21%, and Adjusted EBITDA was $555.7 million, up 54%. Net income was $277.9 million. The company raised its 2026 guidance for the second time, to revenue of $5.790 billion to $5.830 billion and Adjusted EBITDA of $2.295 billion to $2.315 billion. Nov 4, 2026: TKO said it intends to start more share repurchases. About $936.0 million remains of its $3 billion authorization, and it plans to use new debt and cash on hand. It bought back $85.5 million of Class A shares in Q3 2026 under a plan that ended on October 30, 2026. Sep 30, 2026: TKO paid a quarterly dividend to holders of Class A common stock, from an aggregate distribution of about $150 million by TKO OpCo, or $0.79 per share. Jul 1, 2026: TKO finished its accelerated share repurchase of $800 million, for 4,167,298 shares of Class A common stock. From May 14 to July 22, 2026, it also bought 1,022,434 shares for about $200.0 million.