TKO Group Holdings: B of A Securities raises PT to $210 from $200.

TKO Group Holdings: B of A Securities raises PT to $210 from $200.

B of A Securities has raised its price target for TKO Group Holdings (NYSE:TKO) to $210 from $200, reflecting the company's strong financial performance and strategic partnerships [1]. The upgrade comes as TKO continues to capitalize on its media rights strategy, particularly with the recent acquisition of the UFC rights by Paramount Global [2].

TKO Group Holdings has been performing well, with its second-quarter 2025 earnings exceeding expectations. The company reported an EPS of $1.17, surpassing the forecast of $1.13, and revenue of $1.31 billion, outperforming projections of $1.22 billion. UBS and Jefferies have also raised their price targets and maintained a Buy rating on the stock, citing confidence in the company’s media rights strategy [1].

The recent deal with Paramount Global, valued at $7.7 billion over seven years, has significantly expanded TKO’s reach. This agreement will make all UFC events available to an estimated 50 million U.S. Paramount+ subscribers, a substantial increase from the previous 22-25 million ESPN+ subscribers. The deal also includes a shift from the pay-per-view model, allowing Paramount+ subscribers to access UFC events at no additional cost. This move is expected to drive additional revenue opportunities for the company [2].

Despite the positive developments, Benchmark maintains a Hold rating on the stock, citing concerns over structural vulnerabilities such as declining live events and hospitality revenue due to site fee timing issues and a contraction in IMG revenue from rights losses [1]. However, B of A Securities believes that these issues are manageable and that the company's strategic partnerships and strong financial performance will continue to drive growth.

TKO Group Holdings is currently trading near its 52-week high of $182.60, with a premium P/E ratio of 68.46. The company maintains a "GOOD" financial health score according to InvestingPro analysis. Morgan Stanley has maintained its Equalweight rating and $165.00 price target, suggesting the broader distribution and incremental advertising revenue are already factored into its valuation model [1].

In conclusion, B of A Securities' price target upgrade for TKO Group Holdings reflects the company's strong financial performance and strategic partnerships. While there are concerns over structural vulnerabilities, the potential for additional revenue opportunities and a larger audience for UFC events make this a compelling investment.

References:
[1] https://za.investing.com/news/analyst-ratings/tko-group-stock-holds-steady-as-morgan-stanley-maintains-equalweight-rating-93CH-3832203
[2] https://stocktwits.com/news-articles/markets/equity/paramount-acquires-ufc-rights-for-7-7-billion-7-years-skydance-merger/chruxI6RdIu