Back to Main

United Airlines and TD Bank Score With NHL Finalists, but Will You?

By: Minyanville
Posted: 6/24/2013 4:01:00 PM
Referenced Stocks: BAC;C;JPM;TD;UAL

With three of five games requiring at least one overtime period -- or three, in the case of Game 1 -- this year's Stanley Cup Final keeps serving up quality championship hockey.

Game 6 between the Chicago Blackhawks and the Boston Bruins is slated for tonight at 8 p.m. EDT, and with the series standing at 3-2 in favor of Chicago, the Bruins will be defending their home ice in order to stay alive and force a do-or-die Game 7 back in Chicago.

The advertising in leagues like the NHL, MLB, and NFL may be a little less overt than NASCAR's advertising, but professional sports of every stripe are more than just entertainment franchises -- they are mini-industries.

When coverage starts tonight, it will be coming live from TD Garden in Boston, which is named for Toronto-Dominion Bank ( TD ). If we do get to enjoy a nerve-rattling Game 7, all eyes will be on the United Center, whose naming rights belong to United Continental Holdings Inc ( UAL ).

With an average of 5.356 million viewers tuning in for the first four games of the series, according to an NBC Sports Group press release , the sponsors of this year's finalist's arenas will receive a fair share of advertising impressions.

Coupled with the fact that there should be no mention of Wells Fargo Center, First Niagara Center, American Airlines Center, or Air Canada Centre over the airwaves tonight, it pays to pick a winner when it comes to purchasing stadium-naming rights.

While associations with the Bruins and the Blackhawks will bring welcome exposure for United and TD, should you welcome them into your portfolio?

What the Analysts Say

Toronto-Dominion Bank: On June 19, Barclays Capital downgraded TD from "overweight" to "equal weight," dropping its target price from $91 to $86. After opening at a little less than $81 on the day of the downgrade, TD is now trading above the $77-per-share mark, over $8 less than its 52-week benchmark of $85.49.

TD has been doing a good job with shareholder money. Its return on equity (ROE) of 14.04% over the past 12 months outstrips JPMorgan Chase & Co.'s ( JPM ) ROE of 11.55% and Wells Fargo's ROE of 13.07%.

Paying out a 4.19% dividend yield, TD offers a greater dividend than JPMorgan, Wells, Bank of America Corp ( BAC ), and Citigroup Inc. ( C ). With its next ex-dividend date of July 5 quickly approaching, investors who jump on board will receive $0.81 per share when the dividend pays out July 31, although analysts' consensus on the stock currently calls for investors to "hold."

United Continental: Hockey aside, United also finds itself in the news as one of the first purchasers or The Boeing Company's (BA) new edition of its Dreamliner line of planes, placing an order for 20 of the top-of-the-line airplanes. United also converted an order for 25 of Airbus's A350-900 models into an order for 35 of the newer A350-1000 aircrafts on June 20.

This investment of billions of dollars in capital upgrades could prove valuable in the long haul. Both of these newer models boast premier fuel efficiency, and with US airline carriers scheduled to consume over 5 billion gallons of fuel through April 2013, costing almost $15 billion, according to TranStats , increased efficiency results in significantly lower day-to-day costs.

A wave of "strong buy" analyst opinions on United a few months back has largely subsided into a "hold" consensus of late, but following a reported $417 million loss in Q1, the summer travel season could provide a much-needed bolster for the airline.

So as you're glued to the screen for tonight's game, just remember that the company whose namesake graces your favorite team's home ice could be the key to success. Then again, so could a Game 6 appearance from Bergeron.