Jefferies: Manchester United Has 'Unparalleled Reach' Among Sports Teams

Manchester United PLC MANU, arguably the world's most recognizable sports franchise, is a long-term winner, according to Jefferies.

The Analyst

Jefferies analyst Randal Konik re-assumed coverage of Manchester United with a Buy rating and $26 price target.

The Thesis

After a four-year hiatus, Jefferies restarted coverage of the company behind the soccer team Monday.

Jefferies led the company’s 2012 IPO effort, and the story is unchanged, Konik said.

Manchester United is a global brand with unparalleled reach that benefits from a changing media landscape where live content is becoming increasingly valuable, the analyst said.

“While team performance can fluctuate season to season, MANU’s history of winning and success are unmatched, and that has led to the storied franchise having the highest global following of any other sporting team,” he said. “This in turn creates unparalleled reach, which has real value.”

To put Manchester United’s audience in perspective, the team's 2015 Premier League match against Liverpool drew an estimated global audience of 700 million. The 2018 Super Bowl drew just 130 million viewers.

With scripted content being consumed differently — generally recorded or through Netflix, Inc. NFLX — live sports content is more valuable than ever, leading advertisers to sell into multiple markets, Konik said.

Manchester United’s global reach presents advertisers and brands with the perfect outlet to increase their return on investment, the analyst said.

“In our view, the Manchester United brand can be monetized through a multitude of sponsorships. Nearly 40 categories have been identified for potential global sponsorship and we also see opportunity for regionally targeted deals, particularly in Asia."

Price Action

Manchester United shares were down 1.09 percent at $17.30 at the close Monday.

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