Community Sports in NSW to Return in July; 3 Stocks in Action

  • Jun 10, 2020 AEST
  • Team Kalkine
Community Sports in NSW to Return in July; 3 Stocks in Action

Summary

  • Betting industry is expected to witness stimulated business activities, on the back of either recommenced or set to return sporting events and leagues.  
  • Online trends sustained momentum of several gaming and sports-related companies, which saw substantial revenue generation from the platform. 
  • Industries associated with sports are likely to experience significant improvement in customer attention.  

Massive uproar in stadiums syncing with vigorous pace of raging players has been undeniably poorly missed by Australians, who now seem to resort to coverage of past sporting events. But Alas! The missing ambivalence around the known outcomes certainly creates a wide chasm, choking the fervour that usually surrounds sports. To simply put, COVID-19 along with restraining the daily momentum of lives, at one fell swoop, also muffled the zeal of sports.

However, flattening curve and offset of community transmission come as a harbinger of joy for sports fans. With declining infection cases, many activities have resumed in different parts of Australia. New South Wales, which was the first state to shut everything down, did not see any community transmission of coronavirus in last two weeks. As per the Department of Health, Australia in the past 24 hours as on 10 June 2020 reported only two new cases. 

Community Sports to Pick Up the Pace

Optimistic scenario in health circumstances across the country has transpired into positive news for sports enthusiasts. NSW State Government has confirmed that community sports would be returning in New South Wales from 1 July 2020. This would mean that senior community sports will be back in action along with junior sports, which was earlier relaxed by the government. 

According to ongoing restrictions, outdoor sports inclusive of players, spectators and others are restricted to a maximum of 10 people currently in NSW. However, the limits are set to lift next month, sending the ripple effect of energy among sports enthusiasts. Meanwhile, Queensland, which currently allows gathering of up to 20 people, would exceed the limit to up to 100 people from 10 July 2020. 

Do Read: Gaming Players under Radar, Playing season knocking off with the new normal

As several sports venues are set to open, safety restrictions would be rolled out to avoid the second wave of infection. Restricted number of people with sufficient measures for contact tracing would be maintained to mitigate chances of the 2nd wave of infection.  

Local clubs with latest announcements are brimming with energy while sports-related stocks are also garnering investors’ attention. Let us look at few ASX-listed stocks that remain in the radar with sports relaxations set to be implemented from July.

Brisbane Broncos Limited (ASX: BBL)

Brisbane Broncos Limited (ASX: BBL) is one of the significant clubs in the National Rugby League (NRL) of QueenslandThe Board of Brisbane Broncos in late-May had announced the resumption of 2020 NRL competition, which was suspended indefinitely during March, owing to concerns over rapidly changing nature of the coronavirus pandemic and the potential impact on health and safety of players.

The 2020 NRL Telstra Premiership was set to recommence on 28 May 2020, with the Grand Final scheduled to be played on 25 October 2020. However, as per the company’s announcement in late-May, all matches would remain closed for the general public, for time being. 

The Company had earlier highlighted that unprecedented impact of the COVID-19 pandemic, followed by safety restrictions, would result in a substantial decline in revenue for FY20.  

Brisbane Broncos’ Board and Management to mitigate the financial impacts had implemented cost-saving initiatives. Immediate actions involved a reduction of 75% in director’s remuneration and 20% in senior coaching staff fee for the period of 1 April-31 December 2020 while Chief Executive Officer remuneration has been reduced by 50% from 1 April to 31 October 2020. 

By the end of trading session on 10 June 2020, BBL stock settled at $0.415 per share. The stock has given a return of over 10.53% in the past month. 

Catapult Group International Limited (ASX: CAT)

Catapult Group International Limited (ASX: CAT), operating in the sports technology market, develops technologies that help teams and athletes in realising their full potential. 

The Company asserted substantial cash and financial position as CAT began H2 FY20 on the back of free cash flow of $13.6 million in H1 FY20. Meanwhile, cash position of over $30 million included USD$5 million drawn from an existing debt facility.

Around 75% of the Catapult revenue is subscription-based, aided by customer relationships and contracts on a long-term basis. Its solutions are being used and purchased, assisting athletes in performing effectively when the competition begins. 

The Company, however, anticipates that Q4 FY20 new sales can be negatively impacted due to temporary closures and delays of several sporting bodies. 

CAT stock closed at $1.290, with a market capitalisation of $252.94 million, as on 10 June 2020. Furthermore, the stock price has accentuated by over 26% in the past three months. 

PointsBet Holdings Limited (ASX: PBH

Opening of sports season in the Australian landscape is intensifying fervour in the gaming and betting industry as well, which largely relies on the intensive sports drive. PointsBet Holdings Limited (ASX: PBH) offers innovative sports and racing wagering products via a scalable cloud-based wagering platform. 

National Rugby League (NRL) has already commenced while the Australian Football League (AFL) as per its plan is expected to restart from 11 June 2020. The recommencement of these key sports leagues would further expand PointsBet’s offerings in the Australian market. The Company would serve as the exclusive wagering partner Fox Sports AFL following its agreement for the 2020 season. 

For the period April 1 to 25 May 2020, PBH basked in the strong performance of the Australian Trading business, which was fostered by a shift towards online gambling, the Company’s racing turnover growth and enhancement in PBH product offerings. 

PBH stock inched upward by 7% to close the day’s trade at $7.450 on 10 June 2020. The stock has given a month return of over 52%.  

Must Read: Sports Back to Some Gains: PBH, SHO

 


Disclaimer
The video has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. The above video is NOT a solicitation or recommendation to buy, sell or hold the stock of the company (or companies) under discussion. Kalkine does not in any way endorse or recommend individuals, products or services that may be discussed on this site.

 

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