📊 TKO Key Takeaways
Is TKO Group Holdings, Inc. (TKO) a Good Investment?
TKO Group faces structural headwinds with revenue declining 3.1% and net income collapsing 64% YoY, despite generating strong free cash flow of $694.5M. High leverage (1.37x debt/equity, $4.6B debt) combined with extremely poor capital returns (2.6% ROE, 0.6% ROA) and a widening profitability gap ($338.5M operating income but only $89.4M net income) suggests significant debt servicing burden overwhelming operational performance.
TKO Group Holdings, Inc. Key Strengths (TKO)
- Exceptional free cash flow generation of $694.5M (43.5% FCF margin) provides debt reduction capacity
- Solid operating margin of 21.2% indicates core business profitability potential
- Adequate interest coverage ratio of 5.6x demonstrates ability to service debt obligations
- Substantial cash position of $788.9M provides financial flexibility
TKO Stock Risks: TKO Group Holdings, Inc. Investment Risks
- Revenue contraction of 3.1% YoY signals declining demand in entertainment services sector
- Net income plummeted 64.2% YoY indicating deteriorating bottom-line profitability and operational challenges
- Elevated debt-to-equity ratio of 1.37x coupled with $4.6B long-term debt creates balance sheet risk
- Severely depressed returns on capital (ROE 2.6%, ROA 0.6%) indicate shareholder value destruction
- Wide margin compression from 21.2% operating margin to 5.6% net margin reflects heavy debt service drag
Key Metrics to Watch
- Quarterly revenue trend reversal and same-store sales growth in entertainment venues
- Net income and net margin recovery trajectory relative to debt reduction progress
- Debt/equity ratio movement and ability to delever using FCF generation
- Return on equity improvement reflecting capital efficiency gains
TKO Group Holdings, Inc. (TKO) Financial Metrics & Key Ratios
💡 AI Analyst Insight
The 43.5% free cash flow margin provides substantial flexibility for dividends, buybacks, and strategic investments.
TKO Profit Margin, ROE & Profitability Analysis
TKO vs Services Sector: How TKO Group Holdings, Inc. Compares
How TKO Group Holdings, Inc. compares to Services sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is TKO Group Holdings, Inc. Stock Overvalued? TKO Valuation Analysis 2026
Based on fundamental analysis, TKO Group Holdings, Inc. shows some fundamental concerns relative to the Services sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
TKO Group Holdings, Inc. Balance Sheet: TKO Debt, Cash & Liquidity
TKO Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: TKO Group Holdings, Inc.'s revenue has grown significantly by 192% over the 5-year period, indicating strong business expansion. The most recent EPS of $-0.43 indicates the company is currently unprofitable.
TKO Revenue Growth, EPS Growth & YoY Performance
TKO Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q1 2026 | $1.3B | $58.4M | $0.69 |
| Q3 2025 | $1.1B | -$21.6M | $-0.27 |
| Q2 2025 | $1.2B | -$44.7M | $-0.55 |
| Q1 2025 | $1.2B | $58.4M | $0.69 |
| Q3 2024 | $449.1M | -$21.6M | $-0.26 |
| Q2 2024 | $305.2M | -$44.7M | $-0.55 |
| Q1 2024 | $306.7M | -$103.8M | $-1.26 |
| Q3 2023 | $340.7M | -$21.9M | $-0.26 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
TKO Group Holdings, Inc. Dividends, Buybacks & Capital Allocation
TKO SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for TKO Group Holdings, Inc. (CIK: 0001973266)
📋 Recent SEC Filings
❓ Frequently Asked Questions about TKO
What is the AI rating for TKO?
TKO Group Holdings, Inc. (TKO) has an AI grade of C with 70% confidence, based on fundamental analysis of SEC EDGAR filings.
What are TKO's key strengths?
Claude: Exceptional free cash flow generation of $694.5M (43.5% FCF margin) provides debt reduction capacity. Solid operating margin of 21.2% indicates core business profitability potential.
What are the risks of investing in TKO?
Claude: Revenue contraction of 3.1% YoY signals declining demand in entertainment services sector. Net income plummeted 64.2% YoY indicating deteriorating bottom-line profitability and operational challenges.
What is TKO's revenue and growth?
TKO Group Holdings, Inc. reported revenue of $1.6B.
Does TKO pay dividends?
TKO Group Holdings, Inc. pays dividends, with $58.5M distributed to shareholders in the trailing twelve months.
Where can I find TKO SEC filings?
Official SEC filings for TKO Group Holdings, Inc. (CIK: 0001973266) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is TKO's EPS?
TKO Group Holdings, Inc. has a diluted EPS of $1.12.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined grade reflects both perspectives for balanced insights.
What is TKO's fundamental grade?
Based on our AI fundamental analysis in June 2026, TKO Group Holdings, Inc. has a C grade with 70% confidence. Review the strengths and risks sections above for full context. This is not investment advice.
Is TKO stock overvalued or undervalued?
Valuation metrics for TKO: ROE of 2.6% (sector avg: 16%), net margin of 5.6% (sector avg: 10%). Compare these metrics with sector averages to assess valuation.
What is TKO's AI grade for 2026?
Our dual AI analysis gives TKO Group Holdings, Inc. a combined C grade for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is TKO's free cash flow?
TKO Group Holdings, Inc.'s operating cash flow is $694.5M, with capital expenditures of N/A. FCF margin is 43.5%.
How does TKO compare to other Services stocks?
Vs Services sector averages: Net margin 5.6% (avg: 10%), ROE 2.6% (avg: 16%), current ratio 1.34 (avg: 1.5).