The SEC reached a settlement with former WWE CEO Vince McMahon over his failure to disclose $10.5 million in settlement agreements with two women who had potential claims against him and WWE. McMahon signed these agreements—one in 2019 for $3 million with a former employee and another in 2022 for $7.5 million with an independent contractor—but did not inform WWE’s board or legal team, leading to financial misstatements in 2018 and 2021.
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McMahon stepped down as WWE’s CEO in 2022 during an investigation into related allegations and resigned from TKO Group Holdings (TKO) in January 2024 after being accused of serious misconduct in a federal lawsuit. Despite denying any wrongdoing, the SEC noted that his actions bypassed WWE’s internal controls, which caused the company to overstate its 2018 net income by 8% and its 2021 net income by 1.7%. WWE restated its financials in August 2022 after learning about the settlements.
As part of the settlement, McMahon agreed to pay a $400,000 civil penalty and reimburse WWE $1.3 million without admitting or denying the SEC’s findings. However, the SEC emphasized that executives cannot conceal material agreements from company auditors. Nevertheless, McMahon, who transformed WWE from a local wrestling show into a global sports entertainment powerhouse, remains a prominent figure in the industry despite the controversy.
Is TKO a Good Stock to Buy?
Overall, analysts have a Strong Buy consensus rating on TKO stock based on nine Buys and two Holds assigned in the past three months, as indicated by the graphic below. After a 71% rally over the past year, the average TKO price target of $141 per share implies 0.9% upside potential.
