It has only been two weeks since
Manchester United (
. But shares of the world's most famous soccer club are already
behaving like past sports stocks.
Man U's stock has fallen 5% from its $14 IPO price.
Considering that the initial public offering was $2 cheaper than
its expected $16-$20 range, the drop in price since is not a good
Manchester United wouldn't be the first sports stock to fail,
should things continue this way. The two most recent sports
franchises to go public on a U.S. market also failed.
were the last team to try it, listing on the Nasdaq exchange in
June of 1998. The stock went public at $15 a share but quickly
fell to single digits within a matter of months.
In November of 1999, the team was sold to current owner Larry
Dolan, which drove the stock price up above $20 a share. Dolan
took the team private again in February of 2000, with the stock
closing at $22.61 a share.
That means Indians shares gained roughly 50% in the nearly two
years that the team was publicly owned. Sounds like a pretty
hefty return, right? Not when you consider that the team's public
reign came during one of the biggest
in recent memory.
While the Indians' 50% gains sound impressive, they paled in
comparison to the Nasdaq's 123% surge during that same time
Prior to that, the NHL's
went public, in 1996. The stock tripled out of the gates in the
first two months of trading, but eventually fizzled. Overall, the
stock grew during its five-year stint on the market, but was
outpaced by the market itself.
Those are the two most recent examples of sports teams going
public on American exchanges. The Boston Celtics also went public
in the '80s, but that sports stock also had a short shelf
In fairness, Manchester United is a way bigger brand than
either the Indians or the Panthers even in the notoriously
soccer-averse U.S. market. The Indians are a mid-market team that
hasn't won a World Series since 1948. The Panthers are an
expansion hockey team that plays in Florida. Enough said.
It's too early to bury MANU stock just yet. Given its global
following, it should have more staying power than the last two
U.S. sports stocks.
But it's off to a rather ominous start.