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Media Company Endeavor (EDR) Draws Multi-Day Accumulation in Calls Ahead of Earnings

by | May 1, 2022

Endeavor (EDR) with unusual, multi-day accumulation in the May $25 calls options with over 9,375 bought from 4/25 to 4/28, nearly 3K each day. EDR has 13,116 calls in open interest total, so the May accumulation is over 70% of all OI. EDR had sellers in the May and August $25 puts in April as well. Shares are back near the July 2021 lows at $22. The $10.88B company trades 14.85X earnings, 2.15X sales, and 7X cash. EDR operates in multiple segments: Owned Sports Properties, Events, Experiences & Rights, and Representation. Talent management is their longest-running business and one they are most associated but their deal for the UFC is maybe most significant. The company bought a 50.1% stake in the organization in 2016 but they bought the remaining stake in 2020. UFC has grown significantly with a record deal with ESPN, a streaming service and a bunch of international deals which has helped grow their audience. EDR says they reach 1B households now and are a leader among millennials in the US, a key demographic. Analysts have an average target for shares of $36 with a Street High $45. Piper raising estimates on 3/17 as representation remains strong and the UFC posted its best full-year performance in company history. The analyst also noted management sounded confident about the demand for streaming content and sports rights. MSCO upgrading to Overweight in December. The firm thinks media’s content spending surge will benefit pure content owners across entertainment and sports. Hedge fund ownership fell 2.5%. Cantillion Capital a buyer of 3.425M shares.