Investment Website Says "Avoid WWE Stock" At Risk Long Term

Prowrestling.net caught a very interesting article regarding WWE's stock.

The Motley Fool, an investment tip website, has put WWE stock as "one to avoid" as they have done in the past. In this case though, they suggest "the company is paying out 161 percent of its operating income in dividends". The analyst notes that while the company has enough cash reserves to continue this pay out for "a year or two," the company cannot sustain this level of pay out for much longer than that.

As Chris Shore explains, WWE takes their income and divides it by the number of shares of stock, and that gives you earnings per share.

The main concern about investing is "there will eventually come a moment when they don't (assuming EPS doesn't climb above dividend pay outs), creating a liquidity crisis for the company."