With the European Cup in full swing, it’s intriguing to consider the symbiosis between sports and business. Some companies, though not in the limelight, invest substantially in marketing during major sporting events, seeking to leverage the euphoria of the competition. Furthermore, certain stocks have a direct correlation to these events, providing them with a strategic advantage in terms of organic exposure and brand visibility.
While the European Cup might not immediately alter American perceptions of companies like BYD (OTCMKTS: BYDDF) and AliExpress (NYSE: BABA), the European market plays a crucial role in the global landscape for sports and commercial equities alike. Hence, observing how companies adeptly integrate into the marketing fabric of the European Cup can offer valuable insights into their potential short-term performance.
Within this context, let’s delve into two sports-oriented stocks and one commercial stock that stand to benefit from the current heightened exposure provided by the European Cup.
Adidas – ADDYY
Positioned in Germany, the hub of the ongoing European Cup, Adidas (OTCMKTS: ADDYY) has a substantial edge in capturing market share during this tournament. Renowned for endorsing top athletes and outfitting key European teams, notably the Germans, Adidas has forged a reputation for superior quality, cutting-edge fashion, and strong market presence in Europe.
Moreover, through the introduction of revamped retro footwear designs like the Samba and Gazelle, Adidas has successfully reentered the casual sneakers market. Distinguished by its unique color schemes and materials, Adidas’s products offer a fresh alternative to its competitors’ more established branding.
From a financial perspective, Adidas’s first-quarter earnings, reflecting a 3.5% revenue growth year over year and a quarterly net income of 170 million EUR, have reassured many investors after a challenging 2023. Should the company replicate these results in the upcoming earnings reports, it could potentially witness a surge in its stock value.
Nike – NKE
Eclipsing Adidas in uniform prominence at the European Cup, Nike (NYSE: NKE) reigns as the most featured brand, adorning nine teams (37.5%) compared to Adidas’s six teams (25%). This branding superiority extends beyond the European Cup to encompass the World Cup, where Nike has consistently dominated team endorsements.
Furthermore, Nike’s influence extends into the club scene, sponsoring renowned clubs such as Paris St. Germain, Real Madrid, and Chelsea, among others. Today’s Nike earnings call could shed light on the efficacy of the company’s robust approach to professional sports marketing this year, although Nike’s market dominance remains resilient and primed for recovery.
Coca-Cola – KO
Just as summer harmonizes with football (soccer), so does Coca-Cola (NYSE: KO) harmonize with major sports sponsorships. Despite Cristiano Ronaldo’s public distaste for the company during the 2021 European Cup, where his water preference caused a 1.6% dip in KO’s stock value, Coca-Cola is back as a sponsor for the current European Cup.
Although Coca-Cola isn’t the beverage of choice for elite athletes, it remains a staple among viewers of the tournament. Financially, Coca-Cola has exhibited steady performance this year, with a notable 9% rise in share value over the past six months. Despite a slight decline in profit margins, the company’s first-quarter results displayed positive revenue and net income growth, a trend likely to continue into the forthcoming second-quarter earnings report as Coca-Cola focuses on marketing initiatives for the upcoming 2024 Paris Olympic Games.
On the date of publication, Viktor Zarev did not hold any positions in the securities mentioned. The opinions expressed in this article are solely those of the writer.
Viktor Zarev is a scientist, researcher, and writer specializing in demystifying the intricate realm of technology stocks with a keen eye for precision and comprehension.
