Vegas baby, Vegas. Sphere stock has been Super
The Super Bowl is in Sin City. Will that lead to an even bigger boost to the already red hot Sphere Entertainment stock?
The Kansas City Chiefs or the San Francisco 49ers? No matter who wins Super Bowl LVIII at Allegiant Stadium in Las Vegas on Sunday, investors are betting that Sphere Entertainment, owner of the glitzy new interactive performance venue in Sin City, is going to be a Wall Street MVP. Shares of Sphere are already up XX% (couldn’t help but get swept up in the Super Bowl’s famous Roman numeral nomenclature) this year. But even after the 20% surge, investors are hoping that the stock can continue climbing.
Sphere should benefit from all the media exposure surrounding the Super Bowl, which is historically the most watched television event of the year. And Sphere has already announced plans to work with the NFL and CBS, which is broadcasting the Super Bowl on regular TV as well as the Paramount+ streaming network, to display content on the Sphere’s giant LED exterior, naturally dubbed the Exosphere.
There should be a lot of eyeballs on the Sphere during the Big Game. That comes on the heels of the Sphere getting TV exposure on last Sunday’s Grammy awards special. The music extravaganza may have taken place in LA, but the telecast featured a live look at U2 playing its new song “Atomic City” from the Sphere. The legendary Irish rockers are in the middle of a sold-out residency at Sphere. Other artists, such as Phish and Dead & Co., are planning to play big gigs there in the coming months as well.
Sphere just reported its results for its fiscal second quarter as well, posting revenue of $167.8 million but an operating loss of $193.9 million for the Las Vegas venue. The Sphere company also owns MSG Networks, the regional sports giant that has the rights to several New York teams and also features other sports and entertainment programming. The networks business is profitable.
Sphere, by the way, spun off Madison Square Garden Entertainment, the owner of the MSG venue, the Theater at Madison Square Garden and the iconic Radio City Music Hall in NYC, last year. There’s yet another publicly traded MSG stock, MSG Sports. That owns the New York Knicks NBA team and New York Rangers hockey franchise that both play in MSG…and whose games are broadcast on MSG Networks. Whew!
So will Sphere continue to surge after the Super Bowl? Perhaps. But investors should remember that there are other Vegas attractions that could get a lift, such as casino giants Wynn, MGM and Caesars Entertainment. Those stocks, as well as DraftKings and FanDuel owner Flutter Entertainment, may also get a bump thanks to legal sports betting, which is expected to soar to a new record this year.
But CBS owner Paramount may not get too much investor love, even though the struggling media company is currently the target of lots of takeover chatter. Paramount is finding it tough to compete with much larger rivals such as Netflix, ESPN/ABC parent Disney and NBC/Peacock owner Comcast, not to mention the newer threat from the streaming platforms owned by Amazon and Apple.