Not Exactly A Knockout Stock

If Ms. McMahon can't pin her political opponents down for a three-count, WWE would surely welcome her back. In the past few months, the company has taken a pounding.

WWE shares fell 7% last week after reporting what Ms. McMahon's husband, Chairman and CEO Vince McMahon, candidly called “a lousy quarter,” as net income dropped by 69%, to $6.2 million. Mr. McMahon cited such disparate factors as the Icelandic volcano disrupting wrestling events in Europe, the fact that the latest WrestleMania was held earlier in the year, and unexpected retirements by and injuries to several star performers.

But while WWE attributes its recent weakness to temporary factors and a lack of compelling performers, it's also apparent that in tough times, people spend less money on wrestling.

In the meantime, WWE's filings show the lengths the McMahons have gone to minimize the executive-pay issue during the U.S. senate race. While the McMahons possess $700 million worth of shares and have unquestioned control of WWE, they compensate themselves modestly compared with other executives. Ms. McMahon collected a $500,000 salary in her last full year as CEO and waived all other compensation. When the company raised its dividend by 50% in 2008, the McMahons agreed not to be paid the higher dividend for three years, instead accepting the old rate.

source: crainsnewyork.com