Sports as a stock

[Dave Gray]

We've kinda talked about this before, but Colin had a segment on it after the World Cup.  The final women's game got a big rating, bigger than World Series and NHL finals and stuff.  He pointed to a few things, but one of them was just the realization that soccer is coming up.

He said that if sports were a stock, that 10 years ago, soccer was the sport to buy.

Then he compared the NFL to Apple.  Yes, it's on top, but there's nowhere to go but down and it's expensive.
He said the NHL was niche.  It's the North of the country with no diversity.  The All-Star game is all white people, the stands are all white people.

I thought years ago that the UFC was a good buy.  It has grown in that time, but leveled out.

What would you buy now?  What would you sell?

[MikeO]

Buy: NFL and MLB (NFL is obvious and it isn't going down anytime soon that baby is a cash cow that will keep growing, TV ratings for MLB aren't great but the live attendance numbers have had a slow climb year after year and more teams are making more money at the gates than ever.)

Sell:  Soccer (all time high can only go down from here, best players play overseas not in America, no professional woman's league, the mens professional league in this country is really minor league soccer and not the best of the best,  total niche sport that people only care about every 4 years.)  I would also sell NASCAR (TV Ratings and live attendance have been on a steady decline for a few years now, that sport peaked and is on a downward spiral)

[Dave Gray]

I go the other way.

I sell the NFL.  It's really high right now, plus with concussion stuff, I think the product will start losing elite talent to other sports.
I buy the NBA because I think it's stable and it's going to get a bunch of new money from that TV deal.
I think MLB might be a good buy, because it's in a slump, but it's been around so long that it might have a re-surgence.  Also, there's a lot that the sport can do to improve.
I don't touch hockey one way or another.  I think it's fine and will not grow or shrink too much.

[MikeO]

I go the other way.

I sell the NFL.  It's really high right now, plus with concussion stuff, I think the product will start losing elite talent to other sports.
I buy the NBA because I think it's stable and it's going to get a bunch of new money from that TV deal.
I think MLB might be a good buy, because it's in a slump, but it's been around so long that it might have a re-surgence.  Also, there's a lot that the sport can do to improve.
I don't touch hockey one way or another.  I think it's fine and will not grow or shrink too much.

Hockey like Soccer is a niche sport, can't buy it ever, it will never be huge in the United States. NBA is a bad buy in my opinion, that sport is a big hot mess top to bottom.

But the one I want to challenge you on is the NFL. It has had steady growth for 20 years now, its profits dwarf the other sports, it's regular season TV ratings are monster its playoff ratings are off the charts. There is nothing, nothing to show it will change. The concussion thing is a blip on the radar. Those lawsuits have come and gone, more might come but it had zero effect on the sports popularity. They NFL league office can print money its so popular and that won't change anytime soon. Getting back in LA is also a big boom for the league. The NFL has a rocket ship on its back and isn't coming down anytime soon.

[Dave Gray]

I think that the NFL is at risk because people will move their talents to other sports.  Youth programs will suffer and in the long run, it will hurt interest in the league.  Don't get me wrong, I love the NFL, but I think it'll have a downturn.  Everything you said is true about it NOW, but I don't think there's room to grow and make money on the stock.

[Sunstroke]

I'd still buy soccer. Sure, it may be at an all-time high for popularity, but that's an all-time high "now." It doesn't mean that it won't get even more popular. Success breeds popularity, and the more success the US teams have against the world, the more its stock will grow. Another reason is the Us vs Them mentality. With MLB, NFL, NBA and NHL, we are battling against ourselves. United States citizens against United States citizens. Only soccer provides a unifying aspect and appeals to our nationalistic tendencies.

I'd sell MLB, because I think it is a penny stock that won't ever grow that much. The reason I feel this way is because it doesn't contain enough "constant action" to make it an appealing sport for the casual viewer to watch. Do I enjoy baseball? Yessir, I do...because I was raised watching and playing baseball. As kids, we didn't have nearly the amount of options for viewing or playing as kids today do, and I think that is causing an attritional effect in baseball.

I'd hold NBA and NFL, because I believe both are popular sports that should retain their popularity, for the converse reason noted in my MLB-sell strategy. Both are easy to watch for casual viewers.

[Spider-Dan]

Saying that you should buy the NFL is like saying you should buy Microsoft or Comcast or Nike; it's tough to imagine them increasing their marketshare, so you're really just storing money there.

[MikeO]

I think that the NFL is at risk because people will move their talents to other sports.  Youth programs will suffer and in the long run, it will hurt interest in the league.  Don't get me wrong, I love the NFL, but I think it'll have a downturn.  Everything you said is true about it NOW, but I don't think there's room to grow and make money on the stock.

I don't see the downturn coming. In fact I think the big boom has yet to come. When they spread this game international and expand to LA and Europe and put teams there, I think with the increasing popularity of "daily fantasy games" and how sports leagues are going to begin buying into those companies.....what sport would be the most popular there, the NFL and benefit more there, there isn't one! I think with the streaming of shows and streaming of games and such ready to take off in this country, more playoff games, more TV packages (possibly a 9am Sunday Europe game weekly coming soon)....the NFL is on the brink for huge financial growth. More than any other sport on planet earth.

As long as there are poor kids in this country (and lord knows we have enough of them) there will be talent going to the NFL! Maybe the kids from the wealthy neighborhoods shy away from football moving forward, but there are enough poor kids who can and will use it as a way to make a living and get out of their crappy situations they were born in to keep the sport healthy for years to come.

[MikeO]

I'd still buy soccer. Sure, it may be at an all-time high for popularity, but that's an all-time high "now." It doesn't mean that it won't get even more popular. Success breeds popularity, and the more success the US teams have against the world, the more its stock will grow. Another reason is the Us vs Them mentality. With MLB, NFL, NBA and NHL, we are battling against ourselves. United States citizens against United States citizens. Only soccer provides a unifying aspect and appeals to our nationalistic tendencies.

I'd sell MLB, because I think it is a penny stock that won't ever grow that much. The reason I feel this way is because it doesn't contain enough "constant action" to make it an appealing sport for the casual viewer to watch. Do I enjoy baseball? Yessir, I do...because I was raised watching and playing baseball. As kids, we didn't have nearly the amount of options for viewing or playing as kids today do, and I think that is causing an attritional effect in baseball.

1) Boxing is a Penny Stock. That is worthless. MLB's growth at the gate and in revenue in recent years shows this is a sport and business that is growing. It's not growing fast but when looking at NASCAR and GOLF that is losing fans and revenue, MLB is moving in the right direction.

2) Soccer was at an all time high in 1999 as well, and nothing came of it. The success it had in 1999 was as much or more than what happened 2 nights ago. Soccer is like figure skating, every 4 years people get into it for a couple weeks then they forget about it the night after it ends and it's not on the national radar in this country for 4 more years or so.

[Dave Gray]

I'd still buy soccer.  It's HUGE HUGE HUGE all over the world and has lots of room to grow here.  Also, Hispanic populations in the US continue to grow and it's popular there.

As long as there are poor kids in this country (and lord knows we have enough of them) there will be talent going to the NFL! Maybe the kids from the wealthy neighborhoods shy away from football moving forward, but there are enough poor kids who can and will use it as a way to make a living and get out of their crappy situations they were born in to keep the sport healthy for years to come.

I agree with this, but my fear is that the poor kids playing will grow up to be the poor people watching it and there won't be money to throw at it.  Wealthier people will put their kids in soccer and lacrosse or whatever and the interest will be there when they grow up.  Sports have a grassroots effect -- you love what you know.

I sell Golf, Tennis, Nascar, Boxing, Horse-Racing.

Oh, but I do buy College Football in the short term.  The playoffs are going to blow it up in popularity.  That's going to expand and take the sports world by storm.

[Spider-Dan]

MikeO, I'm not sure why you think the NFL will rapidly expand outside of America.  This conversation is like a bunch of Canadians sitting around talking about how hockey is so dominant and is just about to explode onto the world scene.  The World League of Football has come and gone with a whimper, as has NFL Europe.  Football is America's hockey; no one else cares about it.  We can't even get football into the Olympics.

And speaking of failed Olympic sports... baseball has also passed its peak.  While it still enjoys popularity in Latin America, Japan, and Korea, the rest of the world has pretty definitively spoken: baseball is not welcome.  Again, this is why MLB had to set up the World Baseball Classic after being kicked out of the Olympics.

I think everyone in this thread has been shortchanging the sport with the most potential: basketball.  America loves it, the rest of the world loves it, it's firmly entrenched in the Olympics and has many international leagues all around the world.  Basketball is the only sport that can begin to approach the international appeal of soccer, and it's very popular in the U.S., too.

[masterfins]

I'd buy soccer in a second.  To say you wouldn't buy it just because it's not big in the U.S. is idiotic, it's the worlds most played sport.  I'd buy NHL stock, its cheap now, and is finally starting to get some TV time, HD TV's are certainly growing the viewership.  I'd dump NBA stock, the talent level is plummeting in that sport.

[ArtieChokePhin]

Buy:  NBA, MLS/Soccer

Hold but don't buy more: NFL, MLB

Sell or avoid: NHL, UFC, NASCAR,

[MikeO]

MikeO, I'm not sure why you think the NFL will rapidly expand outside of America. 

Because it is and the NFL is doing everything in its power to make sure it happens with all of their actions. The NFL Has the midas touch and they are expanding overseas. They will put a Super Bowl in London and they will put at least 1 team in Europe possibly more. It's a matter of WHEN and not if at this point. And this will be a financial boom for the sport.

[MikeO]

I agree with this, but my fear is that the poor kids playing will grow up to be the poor people watching it and there won't be money to throw at it.  Wealthier people will put their kids in soccer and lacrosse or whatever and the interest will be there when they grow up.  Sports have a grassroots effect -- you love what you know.

Rich kids have been playing lacrosse and soccer for decades and those are 2 sports in this country that nobody cares about. Soccer is a joke in this country, always has been always will be.