Following WWE’s Quarter 2 Earnings report earlier today, WWE stock was up 8.59% and closed at $74.68 per share. The high for the day was $76.06 and the low was $70.27.
Of course, WWE’s drops in ratings, subscribers and revenue still resulted in the stock rising despite the fact that revenues were down 5% and ratings are down 14% for RAW and 11% for SmackDown! Live.
The reason for the stock increase is that investors expected things to be worse. Several Wall Street analysts expected a loss of 3 cents per share for the quarter but instead the company had earnings of 11 cents a share. The company was profitable this quarter with a net income of $10.4 million, as opposed to a $8.4 million net loss in the first quarter.
The gist here is that stock will rise or fall based (in part) on how well the company is performing based on expectations. For example, if a company posts a profit but it is less of a profit than was projected by investors and analysts, the stock is likely to drop because it’s a disappointment. Conversely, it could go up if the company loses money, but loses less money than it was expected to do.
