The bear market wiped out more than two years of gains in sports stocks, with John Wall Street The sports stock index fell 14% in September even though sports betting companies are seeing good trends with the start of the NFL season.
The Sportico A measure of widely held sports shares closed the third quarter at 1,014, down more than 42% from an all-time high. The index is now at its lowest level since August 3, 2020 – the best we can remember is The Rock Day bought XFL. The JohnWallStreet Sports Stock Index was reconfigured as an equal measure of 40 stocks at 1,000 at the beginning of August of that year, rising to a peak of 1,763 by November 1, 2021. Selling in developing stocks, which includes most of the sports-related stocks since then has been almost relentless , with Sportico The index has fallen eight of the past 11 months.
Much of the blame lies with the broad market. The S&P 500 was almost completely in a bear market in 2022 and is down about 25% since the start of the year.
“It’s been a very painful quarter for the stock market,” Tim Gresky, chief portfolio strategist for Ingalls & Snyder in New York, told Reuters. “There is uncertainty about the Federal Reserve and its ability to keep the economy moving along while they attack inflation and bring it down to a sustainable level.”
These broad concerns led to a drop in nearly every stock in the Sports Index in September. FaZe Holdings (FAZE), The worst performer was the parent company of esports company FaZe Clan, losing 47% of its share price. Work has been evaluated in 1 billion dollars In the SPAC merger that made it public this summer; It now has a market capitalization of $706 million. The weakness comes from the lack of clear news but from the lack of market support that has been typical of companies that went public via a blank check merger this year.
Lots of other companies suffered huge losses in September, with 28 out of 40 of the Sports Index losing 10% or more of their value. Dactronics (flattened)which makes scoreboards used at 60% of all North American professional sports facilities, lost 34% in the month, despite reporting a 19% quarterly sales rise and a record backlog of orders, including a nearly acre-sized screen for the L.A. Clippers. The Intuit Dome is now under construction. Nike (NKE) Shares were crushed on Friday, plummeting nearly 13% — a loss of nearly $20 billion in value — after reporting third-quarter earnings that matched roughly in line with expectations, but belied the fact that the company had resorted to discounting its goods to move inventory. “Sell more, earn less? Just don’t do it,” wrote analyst Simeon Siegel at BMO Capital Markets.
bet on stocks that brisk In August he appeared to be enjoying a strong start to the NFL betting season, all less in a month. GeoComply, which provides services to the sports betting industry, said there were 103 million transactions in the league’s opening weekend, up from 60.1 million from 2021. That should have encouraged Wall Street — it reflects strong business in newly opened betting cases — and on On a relative basis, most bets haven’t fallen as badly as the broad market.
However, there were a few companies that saw big sell-offs in September, including Caesars Entertainment, down 25%, partly affected by concerns about Asian casino volumes, and Rush Street Interactive, down 24% as their margins were trimmed by New York. . High tax rates on sports bets.
Only four stocks recorded gains in the month, and only world wrestling entertainment (WWE, up 5%) An increase of more than a nominal amount. WWE continues to gain momentum from media deals and beating Earnings forecast. Over the past year, WWE has been the best performing sports stock, up 26%.
SporticoThe JohnWallStreet Sports Stock Index is meant to reflect the state of the sports business. To be included in the index, companies must have a minimum market capitalization of $50 million and be trading in sufficient volume on a US stock exchange. The index is rebalanced quarterly, as components are dropped and added as needed and the weights of each stock return to 2.5% of the index.
As the fourth quarter began, SPAC RedBall was dropped from the index because it closed and returned its capital to shareholders after failing to implement the merger during its two-year life. He takes his place Kevin Durantled plumber, Infinite Possession (NFNT). Infinite held its initial public offering in November of last year — at the height of stock growth — raising $240 million to pursue a sports tech or other consumer tech business. While SPACs were among the most hateful Stocks in the stock market Recently, there are still 64 sports-related SPAC companies actively seeking to go public with a company. As a group, they have $18.4 billion in capital raised from initial public offerings, according to data they compiled. Sportico.