What Investors Should Know as Football Season Approaches

What Investors Should Know as Football Season Approaches

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Football season is back, so what does that mean for stocks?

A new version of Madden (EA) came out for iOS. Rupert Murdoch unveiled his new, lavishly funded sports network to compete with ESPN (DIS) last week. And McDonalds (MCD) officially announced a roll-out of bone-in chicken wings; a promotion that will run through the fall. 

In other words, it's football season.

Football is by far the most popular sport in the US. In fact, if you count college sports and professional sports separately – football is the first and third most popular sport - beating out NASCAR and professional basketball. It's kind of a big deal. 

So if you're wondering whether Oregon undergrads really need chairs with the same leather found in Ferraris, you're missing the point. Louisville, once a middling Kentucky commuter school, has quintupled its research budget in the last 12 years, simply by moving games to Tuesday in a deal with ESPN. Viewership of Louisville games has since skyrocketed – leading to new donors, recruits, and sports stadiums. And some of that money is even financing efforts in the classroom. 

When it comes to the entertainment industry, football is king, and that can cause some inconsistencies. As disgruntled executives from the content provider Viacom (VIA) point out, Disney's ESPN gets to charge more from cable providers than Viacom does for all of their other channels combined. ESPN is four times the cost of the next most expensive channel. 

ESPN's practices have even garnered the attention of the FCC and the Justice Department. Both organizations have looked into the network's practice of buying rights to more games than it can possibly air, considered an anti-competitive practice. However, there's still some market share for Fox Sports, which already has an extensive collection of offerings in its portfolio, including a 49% stake in the Big Ten Conference.  

The impact of football on the current media landscape is undeniable – in fact, some would argue that it's literally the only thing keeping traditional "bundle" cable packages around. Senator John McCain, among many others, wants to allow customers to purchase channels individually. Therein lies an elusive target for the tech sector. Companies like Google (GOOG) are pursuing sports-streaming options of their own, which would allow viewers to drop cable altogether. However, the lengths media companies will go to protect their air-rights – Disney donated $400,000 to politicians who deal with this sort of thing since 2000 – shows just how important football is to a number of different markets. And we're only getting started. 

Click on the interactive chart to see analyst ratings over time. Sourced from Zacks Investment Research. 

Does the new football season impact these stocks? Use the list below as a starting point for your own analysis. 

1. Electronic Arts Inc. (EA, Earnings, Analysts, Financials): Develops, markets, publishes, and distributes game software and content for video game consoles, personal computers, mobile phones, tablets and electronic readers, hand held game players, and the Internet. Market cap at $8.47B, most recent closing price at $27.86.

 

2. McDonald's Corp.(MCD, Earnings Analysts Financials): Operates as a foodservice retailer worldwide. Market cap at $95.44B, most recent closing price at $95.31.

 

 

3. Buffalo Wild Wings Inc. (BWLD, Earnings, Analysts, Financials): Engages in the ownership, operation, and franchise of restaurants in the United States. Market cap at $2.03B, most recent closing price at $107.98.

 

 

4. CBS Corporation (CBS, Earnings, Analysts, Financials): Operates as a mass media company in the United States and internationally. Market cap at $32.22B, most recent closing price at $52.91.

 

 

5. Walt Disney Co. (DIS, Earnings, Analysts, Financials): Operates as an entertainment company worldwide. Market cap at $110.55B, most recent closing price at $61.35.

 

 

6. Viacom, Inc. (VIA, Earnings, Analysts, Financials): Operates as an entertainment content company in the United States and internationally. Market cap at $38.18B, most recent closing price at $80.00.

 

 

7. Twenty First Century Fox, Inc. (FOX, Earnings, Analysts, Financials): Operates as a diversified media and entertainment company worldwide. Market cap at $73.33B, most recent closing price at $32.18.

 

 

8. Anheuser-Busch InBev (BUD, Earnings, Analysts, Financials): Engages in brewing and selling beer in North America, Latin America, Europe, and the Asia Pacific. Market cap at $155.67B, most recent closing price at $96.85.

 

 

(List compiled by James Dennin. All data sourced from Finviz.)

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7 Responses to “What Investors Should Know as Football Season Approaches”

  1. This is really what I wanted to say. You are just said what's been in my thought for a long time. Thank you for that.

  2. Very good blog. Congratulations idea.

  3. Great blog. Thanks for sharing

  4. Will says:

    Therein lies an elusive target for the tech sector. Companies like Google (GOOG) are pursuing sports-streaming options of their own, which would allow viewers to drop cable altogether.

  5. juan achi says:

    However, there's still some market share for Fox Sports, which already has an extensive collection of offerings in its portfolio, including a 49% stake in the Big Ten Conference.

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