Welcome back to Market on Close. I'm Sam Bartis. On the floor of the New York Stock Exchange, TKO Group is today's overlooked stock after UBS raised its price target on shares to $235 from 200 bucks.And it also kept a buy rating on the shares. The stock is at an all-time high uh on Monday, but it has pulled back by about 4% since then. Joining me now is George Sllis, who is the senior markets correspondent with the news on that and what you need to know about TKO Group.George, hello to you. All right, Sam. ...

Financial Data and Key Metrics Changes - The company generated revenue of $1,269 million in Q1 2025, an increase of 4% compared to the previous year [21] - Adjusted EBITDA was $417 million, reflecting a 23% increase, with an adjusted EBITDA margin of 33%, up from 28% in the prior year [21] - The UFC segment reported revenue of $360 million, a 15% increase, and adjusted EBITDA of $227 million, a 17% increase, with an adjusted EBITDA margin of 63%, up from 62% [22] - The WWE segment generated revenue of $392 million, a 24% increase, and adjusted EBITDA of $194 million, a 38% increase, with an adjusted EBITDA margin of 50%, up from 44% [25] - The IMG segment reported revenue of $476 million, a decrease of 13%, and adjusted EBITDA of $74 million, a decrease of 10% [29] Business Line Data and Key Metrics Changes - UFC's Live Events and Hospitality revenue increased by 66% to $59 million, driven by higher site fee revenue and ticket sales [23] - WWE's Live Events and Hospitality revenue increased by 52% to $76 million, primarily due to increased ticket sales [25] - Partnerships and marketing revenue for UFC increased by 32% to $64 million, while WWE's partnerships and marketing revenue surged by 86% to $26 million [23][27] Market Data and Key Metrics Changes - UFC set new records for live events, including the highest grossing Fight Night in company history in London and the highest grossing indoor arena event in Australia [6] - WWE's WrestleMania 41 became the most successful event ever, breaking records in gate, premium hospitality, viewership, sponsorship, merchandise, and social engagement [10] - WWE's international footprint on Netflix expanded, with significant engagement increases in markets like Mexico, the UK, Australia, and Brazil [9] Company Strategy and Development Direction - The company is focused on integrating newly acquired assets IMG, On Location, and PBR to drive top-line growth and cost synergies [5] - A strategic partnership with Meta aims to enhance UFC content through innovative experiences [7] - The company is committed to a robust capital return program while maintaining a strong balance sheet and exploring new opportunities in boxing [36] Management's Comments on Operating Environment and Future Outlook - Management noted no signs of a slowdown in consumer behavior, with strong performance expected to continue across live events and partnerships [20] - The company raised its full-year guidance, targeting revenue of $4,490 million to $4,560 million and adjusted EBITDA of $1,490 million to $1,530 million [38] - Management expressed cautious optimism regarding the UFC media rights negotiations, emphasizing a flexible approach to maximize long-term brand growth [65] Other Important Information - The company generated $136 million of free cash flow in Q1 2025, with a free cash flow conversion rate of 32% [32] - The company ended the quarter with $2,776 million in debt and $471 million in cash and cash equivalents [35] - The company plans to commence a $2,000 million share repurchase program in the second or third quarter of 2025, subject to market conditions [35] Q&A Session Summary Question: Update on UFC rights renewal and free cash flow for 2025 - Management is in discussions with various third parties regarding UFC rights, with ESPN still included in the mix [48] - Free cash flow conversion rate is expected to be over 60%, excluding nonrecurring amounts [50] Question: Economics of the Canelo announcement and boxing strategy - The new boxing organization plans to host an average of 12 fights per year, with separate media rights deals and global partnerships [58] Question: Outperformance in UFC and WWE - Outperformance in Q1 was driven by strong live event and global partnership performance, with confidence in continued momentum [72] Question: Capital returns and share repurchase program - The share repurchase program will be market-driven and opportunistic, with a focus on maintaining cash reserves [78] Question: Growth modeling for the IMG segment - The company intends to provide more transparency and KPIs for the IMG segment, anticipating growth in both revenue and margins [84]