The latest round of kneeling protests in the NFL has caused many fans to turn off their television sets in disgust — as witnessed by lower ticket sales and television viewership, as well as the planned “shut-off” this Sunday in which some fans are turning off their TVs to register their disgust.
Of course, this is really bad news for the NFL, as the fewer viewers and fans tune in and turn out, the less money is made from advertising revenue and ticket sales. This means less capital will be available to build teams and make repairs and improvements to local stadiums.
But it’s not just fans who are reconsidering their investment in the sport. Apparently, investors are having second thoughts as well — including JP Morgan Chase:
JPMorgan Chase & Co.’s Shawn Quigg is now encouraging investors to stay away from investing in CBS stock ahead of the NFL’s Week 4 broadcasts, according to Bloomberg.
“The bank recommends buying an option that gives you the right to sell the shares at $57.50 on the likelihood that the stock will fall below that price after the company discloses ratings for the games. CBS closed at $58 on Tuesday,” Bloomberg noted.
The analyst also cited jersey sales, saying that if the NFL is going to take a hit, jersey sales may be a leading indicator.
“NFL-related revenue is not trivial to CBS, and any decline in NFL viewership related to the National Anthem debate may negatively affect future results,” he said Wednesday. “We view this weekend’s viewership results as a cleaner proxy in determining whether the Anthem debate may be a larger issue for the NFL, and CBS, or not.”
According to Bloomberg, NFL ad revenue makes up 10 percent of CBS’s total revenue, Quigg noted, meaning that any hit CBS takes could be consequential.
Quigg warned that another week of bad ratings could “mobilize investors to take the potential impact more seriously.”
This should be all the proof the NFL needs that these protests have negative consequences for the future of the league and the sport.
If they wish to preserve their business and their profits, they better heed the concerns of the consumer.