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2008 was one of the ugliest years I can ever remember. In the Fall of 2008, it appeared the world was coming to an end, and the value of every asset on the planet would plunge to an unprecedented low. During 2008, aside from the imminent collapse of the financial institutions, here's how the sports business world looked:
Across the sports world, revenues were falling, fans were dropping out in droves, sponsorships were drying up, and endorsement money was falling off a cliff.
The largest fight promoter in the industry- UFC (Ulitmate Fighting Championships) was dubbed the "Ulitmate Money Machine" by Forbes Magazine. During 2008, one report published by a well known growth analyst suggested MMA had already surpassed professional boxing and would surpass NHL Hockey by mid 2009. Another report suggests MMA has already surpassed NBA baskeball for popularity amongst suburban youth. In 2001 UFC was bleeding cash, and casino giants Frank and Lorenzo Fertitta invested $2 million in UFC's parent company Zuffa. Zuffa was worth over $1 billion by 2008, and I'm not sure how much its worth today- I know it's a lot more. In 2009, an event held in Las Vegas two weeks before the Super Bowl hauled in $25 million in revenues- 10,700 paid an average of $340 to see the show live, and revenues were generated from Pay-Per-View, merchandising, etc. 500,000 viewers were willing to pay $55 to see Pay-Per-View versions of events in 2009. This new "genre" of sports entertainment was thriving back in the 2008 to 2009 time frame when the world was falling apart, so imagine how it's doing now?
The hot new player in the MMA scene is Take Down Enertainment (TKDN). There's been a price and volume explosion in the stock over the last week, and the last two days have seen huge volume spikes as the stock continues to move higher.
Revenue streams in the industry are being generated by ticket sales to events, pay-per-view fees, television licensing, consumer product sales, digital media revenues, and advertising and sponsorship fees. The MMA industry as a whole is now valued in the $3 billion range. While UFC still dominates the industry, there are now thousands of smaller promoters popping up everywhere on a global scale, and fans want to see the events. Enter TKDN as a content aggregator. TKDN is aggregating the events of these thousands of smaller global promoters, and making their fights commercially availble on all the media outlets. TKDN is consolidating the content of thousands of smaller web sites and digital media content to a "one stop shopping" theme for fans. The company has been getting some major traction of late, recently signing distribution agreements with independents in droves. Here's the list of producing companies TKDN has signed with just since late July:
TKDN has big plans to consolidate the content all of these smaller independents and distribute it through TV, Online, and mobile, along with acting as the central "hub" for fans to come to in order to find out where the hottest new event is happening. Merchandise sales will also be a big part of their revenue model as fans are clamoring to buy all sorts of products associated with this sports phenomenon.
As hot as this sport is, the stock is even hotter.This is definately a volume and momentum play, so there might be a lot of money to be made as this stock continues to work higher.
Everyone of these independents will need the service TKDN provides, and TKDN will in turn generate revenues everytime one of these independents puts on an event. I am attending my first event at the end of October- yes- I'm going to see what this is all about. As you can see, this stock kind of worked its way up to $.90, then the real volume started to come in over the last two days. The volume has absolutely exploded to about 400,000 shares each of the last two days. Not a lot was bought at lower levels, so this stock should be able to continue moving higher. There's no reason. with this stock trading as well as it has in very down markets the last two days, it couldn't trade up another 50% higher over the next 30 days- perhaps more. But, let's keep it reasonable. If you see the opportunity in MMA as this company aggegates the content and provides services for more of the smaller entertainment promoters, it could become an acquistion target by Zuffa- the parent company of UFC. Here's my thoughts for you speculators that want to make some money. This stock should be owned up to $1.10. Your upside target over the next 30 days is $1.50. Your SSL is $.88- if it trades below the past two days lows of $.90, you'll want to keep a careful eye. This company is positioned to take advantage of the growth of the hottest new sport to come along in decades. Fight your way to making money anyway you can. Home Page : www.otcjournal.com
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