- The NCAA basketball championship makes an estimated $1.3 billion every year
- Iowa’s Caitlin Clark 2024 NIL take is estimated at US$3.1 million, USC’s Bronny James estimated 2024 NIL sponsorship deal is just a little more than US$7 million.
- Americans will bet more than $2.7 billion on the tournament, roughly twice the amount legally wagered on this year’s Super Bowl
- Disney’s ESPN partnered with Penn Entertainment to relaunch Penn’s sports book at ESPN Bet. Analysts believe earnings will grow by an average of 14% annually over the next three to five years.
March Madness is here. During the three-week basketball tournament all eyes will be glued to the live broadcasts, watching as the 68-team tournament culminates in one shining moment April 8.
The NCAA makes an estimated US$1.3 billion from March Madness. If you are looking to cash on the tournament, here are some stocks that might see an incline as a result of the NCAA’s three-week championship.
Nike Inc.
NYSE:NKE
Sports apparel company NIKE has continued to dominate as the top shoe and jersey provider of teams in the NCAA Tournament. Nike has estimated its earnings growth will be 9.6% for the fiscal year ending May 2024.
The Swoosh has also sponsored several NCAA basketball players including Iowa’s megastar and highest-earning women’s college player, Caitlin Clark. Her overall NIL (name, image and likeness) take is estimated at US$3.1 million. And Bronny James (son of the NBA superstar LeBron James) of the University of Southern California joined the Nike family at the same time as Clark – his estimated overall NIL 2024 sponsorship deal is a little more than US$7 million. Nike shares were trading at just under 94-dollars US.
Additionally, as of March 27, Clark was reportedly offered US$5 million (a historic offer) from rapper and Big 3 professional basketball league founder Ice Cube to join the league.
DraftKings Inc.
NASDAQ: DKNG
No doubt, big bucks to will be spent during March Madness. Americans will bet more than US$2.7 billion on the tournament, according to the American Gaming Association. Roughly twice the amount legally wagered on this year’s Super Bowl.
Popular sports books include FanDuel and BET MGM, as well as one of the earliest entrants to the sports betting scene, DraftKings. The company has accrued a 35 percent market share and is expanding into online casino gaming and lottery.
DraftKings hit 3.4 million unique monthly paying customers at the end of Q4, up 37 per cent year over year. The company has a market cap of US$22.3 billion and company shares were last trading at a little more than US$47.20.
Walt Disney Co.
NYSE:DIS
Disney is positioned as a direct competitor of DraftKings after its deal with Penn Entertainment in August. Disney’s ESPN signed a US$2 billion deal to rebrand and relaunch Penn’s sports book as ESPN Bet. It is not available in Canada, although Penn-owned theScore Bet looks the same and operates in Ontario.
With Disney, investors are exposed to a diversified portfolio. The stock has struggled a bit since the pandemic, and the company is beginning to make money on streaming. Disney CEO Bob Iger recently updated investors on the company’s performance, noting that Disney is trending ahead of cash-flow guidance for 2024. The stock trades at a forward price to earnings ratio of 24 and analysts believe earnings will grow by an average of 14 per cent annually over the next three to five years. Walt Disney Co. is trading at US$116.34.
Warner Bros. Discovery Inc.
NASDAQ:WB
Disney competitor Warner Bros Discovery (WBD) established a permanent sports block on its networks March 11, just ahead of March Madness. The block runs from 6 pm ET until late night with the plan to host simulcasts of WBD’s NHL, MLB and NBA coverage on TNT and TBS, alongside news, magazine and documentary content. WBD shares are trading at just under US$8.50.
Coca-Cola Co.
NYSE: KO
One of the top three sponsors of NCAA March Madness, Coca-Cola has an estimated earnings growth of 4.5 percent for 2024. The worldwide non-alcoholic beverage company’s Coke Zero is the lead soft drink brand in the tournament.
Coca-Cola is the longest standing partner of the Olympic Games and an official NCAA corporate champion since 2002. Company shares are up just under a percent trading at a little more than US$60.50.
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