Which Stocks Could Benefit from the 2022 World Cup in Qatar?
The most important tournament in football is underway, with 32 of the world’s top football nations battling it out for the ultimate prize. But away from the pitch, there’s another side to the sport, the business side. So, besides the football teams, we’ll also see a clash between some of the biggest companies in the world. But who can win? Find out in this article.
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The Football World Cup
The 2022 World Cup will make history by bringing the tournament to the Middle East for the first time. For four weeks Qatar will capture the attention of the entire footballing world, who will be eagerly waiting to see who takes home football’s biggest prize.
But, away from the sporting spectacle, the tournament provides copious opportunities for a number of companies to benefit from the event. Let’s look at some of the numbers for this year’s tournament
- The World Cup in Russia was the most expensive of all time, with a total cost of $14 billion. But that's a drop in the ocean compared to the Qatari government's latest estimate of $220 billion for the 2022 event, mainly attributable to the massive amount of new infrastructure required.
- FIFA claims that 3.75 billion people watched the final of the 2018 tournament, and predicts that up to five billion people could tune in for this year’s final match.
- An estimated 1.5 million fans are expected to travel to Qatar for the event, which will boost the country's tourism and food and beverage sectors.
Companies will spend millions on advertising during the tournament, hoping to get a boost from the global audience watching the 2022 World Cup in Qatar. In fact, spending on marketing and advertising for this year’s World Cup is expected to reach a record high, with the timing of the tournament, in the run-up to Christmas, offering Qatar 2022 the opportunity to provide a unique advertising opportunity for businesses.
Which Companies Could Benefit from the World Cup in Qatar?
Let's take a look at some of the companies that could stand to benefit from the 2022 World Cup in Qatar.
FIFA World Cup Sponsors
The FIFA World Cup™ is a highly effective international marketing platform that reaches millions of people in over 200 countries around the world. Hosting an event of this magnitude requires the support of commercial partners who provide essential products and services to the overall event activities.
The standard package of partner rights includes the use of the official FIFA World Cup™ brands, exposure around the stadium and in all official publications, preferential access to advertise during broadcasting of the World Cup, and much more.
Here is a list of the official FIFA partners:
Here is a list of the official FIFA World Cup Sponsors in Qatar:
- Budweiser (BUD)
- China Mengniu Dairy Co
Many of these companies are not publicly traded, meaning most investors won’t be able to invest in them. However, companies like Adidas, Coca-Cola, Visa, McDonalds and Budweiser are listed on the stock exchange and can, therefore, be invested in quickly.
Sports Equipment Companies
The biggest football tournament in the world can help drive demand for football kits of the participating teams. As a result, the companies which make and sell these kits could see an increase in sales during the tournament. The further a team advances through the tournament, the higher the sales growth could be.
Here is a list of the manufacturers of team kits for the 2022 World Cup in Qatar:
- Nike (NKE) - Qatar, Netherlands, England, USA, Saudi Arabia, Poland, France, Australia, Canada, Croatia, Brazil, Portugal, South Korea.
- Adidas - Wales, Argentina, Mexico, Spain, Germany, Japan, Belgium
- Puma (PUM) - Senegal, Morocco, Serbia, Switzerland, Ghana, Uruguay
- Hummel - Denmark
- Kappa - Tunisia
- Le coq sportif - Cameroon
- Majid Sports - Iran
- Marathon - Ecuador
- New Balance - Costa Rica
As you can see, most of the teams in the tournament (13) will wear Nike kits, but some of the favourites - like Argentina, Germany, Spain and Belgium - will play in Adidas kits.
Of course, it's worth considering that Adidas, in addition to being the kit supplier of participating teams, is also a partner of FIFA and produces the official tournament ball for Qatar.
TV and Streaming Companies
The vast majority of fans around the world will watch games on television. As a result, companies that hold the rights to broadcast the tournament in large countries should attract a strong audience. This is likely to result in a higher amount of advertising revenue during the tournament.
FIFA generated more than $3 billion in revenue from television rights and broadcast licenses at the previous World Cup. The popularity of football around the world has fuelled fierce competition among global broadcasters.
Among the most interesting companies that will broadcast the 2022 World Cup in Qatar are:
- ITV Plc (ITV) - the British broadcaster that, in partnership with the BBC and talkSport, will broadcast the 2022 World Cup in the UK.
- Fox Broadcasting (FOXA) - the media giant will broadcast Qatar 2022 matches in the United States in partnership with Telemundo and Futbol de Primera.
- TF1 - who will broadcast some of the matches in France
Of course, you can also look for other companies that will broadcast the championships in Qatar and other countries, but if you want to invest in them, they must be publicly traded companies.
Many people around the world will try to guess the winning team, the finalists or just the winner of a particular match in Qatar.
This is where bookmaking companies come in, and they gladly accept bets. A big, worldwide tournament means a lot of bets, and, therefore, lots of potential profits for bookmakers.
Here is a list of bookmakers that could stand to benefit from increased betting during the World Cup:
- Caesars Entertainment (CZR) - the world's largest gambling company in terms of revenue
- Kindred Group (UNIBSDB) - this company has a number of bookmakers in its portfolio, the most famous of which are 32bet and Unibet.
- 888 Holdings (888) - one of the largest betting companies in the world, known for its sports betting, poker and online casino.
- Betsson (BETS.B) - Scandinavia's largest bookmaker, which owns a number of other sports betting brands such as Betsafe, NordicBet and others.
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Food and Drinks
Major football tournaments often bring people together in groups at home, in restaurants or in bars to watch the games. This can lead to an increase in consumption of beer, spirits and soft drinks. As a result, companies that manufacture, sell and supply these products may experience sales growth during the Qatar 2022 World Cup.
Some interesting examples include:
- Anhuser Bush (BUD) - the world's largest beer producer. Produces brands such as Budweiser, Corona, Stella Artois, Becks, etc.
- Carlsberg (CARL.B) - the fourth largest beer producer in the world - Carlsberg, Tuborg, Holstein, etc.
- JD Wetherspoon (JDW) - one of the largest pub and hotel owners in the UK.
Of course, many other businesses which operate in similar industries to those listed above could benefit from the 2022 World Cup. We have merely provided a number of examples to illustrate the benefits a World Cup can have on businesses around the world. Before making any investments, you should conduct your own analysis and make sure you are aware of the risks involved.
How to Invest in World Cup Stocks
Now that you know which companies and sectors could benefit from the World Cup, how can you invest in these stocks? Simply follow these steps to start investing:
- Open an Invest.MT5 account to access the Dashboard
- Click Invest next to your account in order to open the MetaTrader WebTrader
- Search for a stock at the bottom of the Market Watch window and drag the symbol onto the chart
- Click New Order at the top of the screen and enter the number of shares you want to buy, before hitting ‘Buy’ to send the order to the market
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- The ability to invest with fractional shares
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This material does not contain and should not be construed as containing investment advice, investment recommendations, an offer of or solicitation for any transactions in financial instruments. Please note that such trading analysis is not a reliable indicator for any current or future performance, as circumstances may change over time. Before making any investment decisions, you should seek advice from independent financial advisors to ensure you understand the risks.