A rundown of the 7 sports stocks with the highest potential for profits this new year.
Sports and games have existed for as long as humans have been able to have fun. For thousands of years, players and spectators alike have come together to enjoy at least a few hours of fun and playful competition. Today, the global sports industry takes in more than $1 trillion annually.
The sports industry paused the pandemic. For the safety of those concerned, sports events were put on hold, and stadiums, fields, and tracks were temporarily shut down.
But now, sports are coming back and are as popular as ever.
To help with this, here are 7 promising stocks to consider buying this 2022:
As investors looking for growth and profit, it could be a good time to take a swing at a sports-related investment.
1. Madison Square Garden Sports (NYSE: MSGS)
Market Cap: $4,021,900,032
The company owns and operates a portfolio of assets consisting of the New York Knickerbockers of the National Basketball Association NBA and the New York Rangers of the National Hockey League NHL.
Like most sports companies, it took a hit during the pandemic as many sports events were put on hold to minimize the spread. In recent months though, the company seems to be on the rebound — showing gains of 7.18% per share over the last 6 months. Despite only employing a staff of fewer than 500 people, the company has a trailing revenue of $377.5 million. Though the continued performance is not guaranteed, investors are optimistic that the worst is behind the company and that 2022 holds profits and breakthroughs as the pandemic begins to wind down.
2. Manchester United (NYSE: MANU)
Market Cap: $2,207,060,736
Who in this wide green Earth has not heard of Manchester United. Even those who maintain that they have nothing to do with sports have heard of the Manchester United football club and their achievements.
Founded in 1878 and based in Stretford, UK, Manchester United have won the most trophies in English club football. This includes a record of 20 League titles, 12 FA Cups, five League Cups, and a record of 21 FA Community Shields. They have also won the European Cup/UEFA Champions League 3 times, and the UEFA Europa League, the UEFA Cup Winners' Cup, the UEFA Super Cup, the Intercontinental Cup, and the FIFA Club World Cup once each.
Despite their many achievements, the company was not able to escape the damage that the Covid-19 pandemic inflicted on the sports industry as a whole. With no games to play, the stock of the famous football club began a slow plummet. Currently, share prices are trading at -7.97% year-to-date.
Some maintain though that this is a good thing with hindsight. The group has existed for almost a century and a half, weathering all sorts of crises. As the pandemic begins to wind down, and players are slowly allowed back into the field, those who purchase stocks now while they are cheap will be jumping for joy like champions with the inevitable rebound of the sports market.
Whether you follow this logic is entirely up to your discretion. We can only advise that you play it safe and look for the possible signs of gains before committing this to the stocks of Manchester United.
3. MSG Networks (NYSE: MSGN)
Market Cap: $808,375,808
MSG Networks Inc. engages in the sports production, content development, and distribution businesses in the United States. It most notably owns and operates the MSG Network and MSG+, which are regional sports and entertainment networks.
A spin-off of the main Madison Square Garden Company operation, MSG Network primarily serves the mid-Atlantic USA with a recent push towards streaming content online through MSG HD — available nationally on DirecTV, Cablevision, Spectrum, Comcast, RCN, AT&T U-verse, and Verizon FiOS.
They also have a radio division known as the Madison Square Garden (MSG) Radio Network.
Listed on the NYSE, has a trailing 12-month revenue of around USD$633.6 million, and employs 475 staff. Though stocks are currently less than stellar now than where they were back in mid-2021, positive developments in the sports industry with a slowly rebounding stock might spell profits for loyal investors.
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4. NIKE (NYSE: NKE)
Market Cap: $229,905,203,200
By far the largest company on this list, Nike is an American multinational corporation that is engaged in the design, development, manufacturing, and worldwide marketing and sales of footwear, apparel, equipment, accessories, and services.
As one of the largest providers of sport’s equipment to consumers and professionals alike, NIKE has probably the most to gain from the slow but sure revival of the sports industry.
The company boasts a 12-month revenue of around $46.3 billion with a dividend yield of 0.84%, small but still attractive for income investors. Over the past 12 months, the company’s stocks have gained 1.38%. Over the past 5 years, they gained 158.61%.
5. World Wrestling Entertainment (NYSE: WWE)
Market Cap: $3,692,293,120
World Wrestling Entertainment, or WWE, is a sports entertainment business that operates in North America, Europe, the Middle East, Africa, the Asia Pacific, and Latin America. It functions through three segments: Media, Live Events, and Consumer Products.
Unlike many of the companies on this list, the stock of WWE has continued to record gains despite the effects of the pandemic. One possible reason for this is that the company actually has quite a diverse portfolio. Apart from the live wrestling events they’re known for, WWE has successfully branched out to toys, radio, film, and even real estate.
The company has also opted to continue operations during the pandemic, telling ESPN.com that "we believe it is now more important than ever to provide people with a diversion from these hard times". The support of the Governor of Florida who deemed them essential to the state’s economy, thus exempted from the stay-at-home policy, also did great to bolster their performance during hard times.
With several controversial layoffs and budget cuts later, it seems the management has successfully kept the company up and running, where so many like it had to close up shop. Stocks of the company have gained by 3.71% year-to-date and by 9.05% over the entire year. WWE also has a trailing 12-month revenue of around USD$1.1 billion.
6. DraftKings (NYSE: DKNG)
Market Cap: $8,390,717,440
Founded only 10 years ago and based in Boston, DraftKings is a fantasy sports company that allows users to enter daily and weekly fantasy sports-related contests and win money based on individual player performances in five major American sports: Premier League and UEFA Champions League football, NASCAR auto racing, Canadian Football League, the XFL, mixed martial arts (MMA) and Tennis.
With over 8 million sports, DraftKings has had somewhat of a meteoric rise over the years since its founding. One important point to make about this company is that, as of April 2016, the majority of U.S. states consider fantasy sports (including daily fantasy sports like DraftKings) a game of skill and not gambling.
Since 2015, Major League Baseball (MLB) has had an investment stake in the company and is considered a close partner.
Though stocks took a hit during the pandemic, currently trading at -58.19% over the past 6 months, the return of the sports industry means a return of DraftKings’ profits.
7. fuboTV (NYSE: FUBO)
Market Cap: $1,574,537,728
When looking at the trajectory of sports viewing, fuboTV should be on an investor’s radar. fuboTV is an American streaming television service that caters to customers in the United States, Canada, and Spain. Basically being the Netflix of sports, the service focuses primarily on channels that distribute live sports events.
Recently, the company reported it closed the third quarter of 2021 with nearly 945,000 paid subscribers and that, since the end of 2021, it had actually hit one million subscribers. It closed last year with a revenue of $156.69 Million, up by 156% year-to-year. This has resulted in the Motley Fool issuing a rare “All In” buy alert for the company's stocks.
With all that said, the company is still relatively new, being founded only 7 years ago. This means that it still has yet to be a profitable option for shareholders.
And those were the 7 sports stocks with the most promise going into 2022. Overall, the sports market still has a little growing to do before we can recommend you invest in it full force. The positive signs are there though and it is only a matter of time before the market returns to its former, healthy self.
Moreover, with proper research and due diligence, there’s a good chance for you to strike gold with any one of these stocks. The stock market is an unpredictable creature, both in a good way and a bad way. With the right information, some educated guesses, and a little luck, who’s to say you won’t score big on a sports stock! Happy trading!