Football stocks to watch in 2022: which football clubs can you buy shares in?

Rebecca Cattlin
By :  ,  Financial Writer

Did you know that the ups and downs of supporting a football team play out on its share price too? Football stocks move with results, revenues and scandals. Find out how you can trade shares of footballs stocks.

 

What are football stocks?

Football stocks are the shares of publicly listed football clubs. Most football clubs are privately owned, but around 20 clubs have opened share ownership up to the masses by trading on the stock market.

The term ‘football stocks’ is also used more broadly, to cover companies that are involved in sponsoring teams, events and providing equipment – including the likes of Adidas and Budweiser – and even companies in the hospitality industry that benefit from match days, such as JD Wetherspoons.

 

Why trade football stocks?

Buying football stocks might be seen as a bit of a novelty, just another way of supporting your favourite team. So, it’s easy to forget that football clubs are first and foremost businesses. Although they provide millions of fans with entertainment, they also seek to provide owners and shareholders with profit.

It’s worth pointing out that while some football clubs are open to investment, you’d need to own a significant number of shares to get any say over the management of the club and other decisions. For the most part, buying football stocks is just a means of getting exposure to the economy around one of the most popular pastimes.

Over the years, professional football clubs have shown they can achieve impressive revenue figures through global broadcast deals, ticket sales, sponsorships, merchandising and player transfers. The Deloitte Football Money League found that the average revenue of the 20 largest clubs was €409m in 2020/21, and this was actually down 12% from pre-Covid levels due to restrictions on match day attendance for some of the year.

You can speculate on whether football shares will rise or fall in value with City Index using CFDs, so you can take advantage of periods of growth and decline.

 

Which football stocks can you trade?

Most of the top revenue-generating clubs are not currently available for public investment. Only three out of the 20 clubs in Deloitte’s Money League are exchange traded. These are:

  1. Manchester United
  2. Juventus
  3. Borussia Dortmund

There are other publicly-traded football clubs on the market, but they’re much smaller in size so tend to have far lower liquidity. This can not only cause difficulty opening and closing positions but tends to lead to higher transaction costs too.

Examples include the two Glasgow clubs Celtic and Rangers, and two Rome teams, AS Roma and Lazio.

 

Manchester United (MANU)

Manchester United is the largest publicly traded football club. Its shares are listed on the New York Stock Exchange (NYSE), under the ticker MANU.

The club’s shares previously traded on the London Stock Exchange (LSE) but left in 2005 after being bought by Malcolm Glazer and his family, who acquired 28.7% of Manchester United. MANU was relisted in 2012 on the NYSE.

As a popular international team, Man Utd is able to make money from multiple revenue streams, such as kit sales, sponsorship deals and broadcasting revenue. But its corporate returns are heavily influenced by match results – and ever since the departure of Sir Alex Ferguson in 2014, the club’s performance has been unimpressive.

When it listed on the NYSE, it was priced at $14 per share, which valued the club at $2.3 billion and made it the world’s most valuable team. Since then, Man Utd stock hasn’t had a clear trajectory. It bounced around until late 2016, when a bull market took it to its record high of $26.20 on 31 August 2018. But since then, its shares have been falling downward – not helped by Covid-19 emptying stadiums and the economic crisis reducing spending.

 

Juventus (JUVE)

Juventus is the biggest of the three Italian clubs publicly traded on Milan’s Borsa Italiana, and the most successful club in Italian football, having won 36 Serie A titles.

The Agnelli family, owners of the Fiat automotive company, gained control of the club in 1923. They continue to hold a majority of the shares.

Juventus was listed on the Borsa Italiana in 2001, at 1.19 per share. But if you’d invested at the IPO, you’d have a negative return, as its shares have been trading below 1 since February 2020.

Juventus has faced its fair share of scandals that impacted its share price – most famously when it was caught up in a match-fixing scandal that saw them relegated from Serie A to Serie B in 2006. When the news broke, JUVE shares fell from 0.67 to lows of 0.39.

Juventus’ revenues had been largely on the up until COVID hit. Revenue for the period ended 30 June 2022 was down 7.8% year-over-year (YoY) to €443.4 million, while operating costs increased 7.6% to €483.4 million.

Borussia Dortmund (BVB)

Borussia Dortmund is a German football club, which listed its shares on the Frankfurt Stock Exchange in 2000. It remains the only German football club to have done so.

At the time of its IPO, BVB shares traded at €11, but have been trading below €8 since 2020.

Interestingly, football and related activities aren’t Borussia Dortmund’s only revenue streams. The club makes money through hotel and car hire bookings, travel services by air, ship, and rail, and package tours offered via travel agents. The club also holds interest in a medical rehabilitation centre.

The club’s diversification had led to strong revenue growth over the years, but Dortmund’s profits peaked in 2017/2018. It’s since been in decline due to falling income from match operations, merchandising and catering. Borussia Dortmund generated revenue of €334,171 in the 2020/2021 financial year, representing a decrease of 9.73% YoY.

 

What impacts the price of football stocks?

Football stocks, like all company shares, are driven by supply and demand. As with most businesses, these are influenced by:

  • Company financials
    A company’s financial statements are usually released to the public a few times a year during earnings season. The reports give investors insights into the current performance of a company as well as its future growth outlook.

     

  • Macroeconomics
    Although not all macroeconomic data will cause share price fluctuations for football clubs, news of economic contractions can spell bad news. Financial downturns ultimately lead to lower consumer spending, with entertainment one of the hardest-hit industries, this can cause lower ticket sales and less money for fans to spend on merchandise.

     

  • Unforeseen events
    Like a lot of sectors, the global pandemic rocked the football industry. It was estimated that as a result of COVID-19 clubs missed out on well over €2 billion of revenue over the 2019/20 and 2020/21 seasons. The impact of COVID-19 on football stocks wasn’t all negative, though. While ticket sales shrunk to an all-time low of €111m, aggregate broadcast revenues broke records at €4.5 billion.

But there are some factors that are unique to football stocks, such as:

  • Game results
    The result of individual matches, and tournaments in general, change sentiment toward the clubs. Although they have little direct impact on the value of the company itself, when a team wins, its perceived worth increases, and the share price can be buoyed.

  • Signing of players
    As with other types of news, the signing of players can boost sentiment around a club, while the selling of a fan favourite can have the opposite effect.

  • Player and team scandals
    When there’s a controversial event involving a player – such as infidelity or drug use – or the entire team, such as match fixing, it can cause share prices to drop as the consequences could impact the team later on. Penalties for team-wide scandals have included relegations in the past, which lead to a loss of revenue.

  • Sponsorship deals
    Large sponsorship deals for the club can boost revenue significantly. Companies pay hefty amounts to be featured on the club’s kit and to show ads in the stadium on match days.

 

Can you trade the World Cup 2022?

You cannot trade the World Cup directly, as there are no publicly traded country football teams. But this year, the World Cup is scheduled to take place in winter for the first time in history, which will have a variety of impacts on the event and trends traders can take advantage of.

Firstly, it means that Premier League clubs are putting the brakes on matches while their players jet off to represent their countries. Although it means they’ll suffer significant revenue losses due to no match-day sales, they will be compensated by FIFA to the tune of £8,500 per day.

UK clubs, including Manchester City, Chelsea, Tottenham and Manchester United, are estimated to be pocketing over £1.5 million for allowing their players to represent their countries in the group stages alone. Depending on how each country progresses, those totals could break the £2 million mark.

Secondly, the impact on the broader economy could be less pronounced. Usually, the hospitality industry in the UK sees a huge increase as fans flock to pubs and other venues to watch the matches. This year, the cold weather and cost-of-living crisis will likely keep more fans at home – which could boost the sale of alcohol and food from supermarkets instead.

Typically, trading volumes for European markets actually decline during the event due to game’s played during trading hours.

 

World Cup stocks

Although there are no publicly traded football teams at the country level, there are other ways to get exposure to the event through:

  • Location-specific companies - like Qatar Airways and other travel stocks could see a boost thanks to the influx of football fans to the country
  • Official World Cup sponsors - including Adidas, Visa, Hyundai and Coca-Cola, could also see a boost due to high profile position of their advertisements
  • Hospitality stocks - such as JD Wetherspoons, have seen a boost in revenue in previous years, although as mentioned this could be more subdued this year

 

How to trade stocks with City Index

You can trade stocks with City Index using CFDs, with spreads from 0.1%. Follow these easy steps to start trading now.

  1. Open a City Index account or log in if you’re already a customer
  2. Search for the company you want to trade in our award-winning platform
  3. Choose your position and size, and your stop and limit levels
  4. Place the trade
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