Football, Goose Island and Taco Bell Doritos
Gerelyn is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
Living right outside of New York City, I can't help but notice all the buzz over the forthcoming NFL season. I suppose this happens in every football town, but this year - in no particular order - there is a new sound around here emanating from the Jets crowd that has the added Tebow chord and of course ecstasy spilling over from last season's NY Giants' Super Bowl victory.
It made me think about the companies that might benefit most from all of the excitement that Sunday afternoons as well as Monday and some Thursday nights have yet to bring NFL fans. I landed on one beer stock and a sporting-goods name, to name a couple. Football season not only means more parties but also the ushering in of outerwear - including jerseys, hats, and sneakers - that are sure to soon begin to crowd my Facebook news feed.
One can argue that Anheuser-Busch (NYSE: BUD) could theoretically rally every time there is reason for celebration or the gathering of the crowd. But the football season lasts not for a day, a weekend, a month or even six weeks. It begins in pre-season fashion in August and continues through to the beginning of the next year. It must be the longest season of any kind ever.
So I took a look at how BUD performed during last year's football season. From the five-month period beginning on September 1, 2011, the stock rallied more than 11% - not bad. Today, the stock is trading very close to its 52-week high of $84.09 at about $83 per share. But in addition to the typical beer sales that the NFL season generates, Anheuser-Busch has strategically timed the launch of one of its newest brews more than half way through the season.
The St. Louis, Missouri-based brewer will introduce Goose Island Beer to the US in November, when football fans everywhere are gearing up for Thanksgiving gameplay. Anheuser-Busch has high hopes for Goose Island, and paid a cool $38.8 million for the brand last year.
The two businesses are no strangers to one another as the new owner previously served as a distributor for the Goose, which until now has primarily been available only in the Midwest. Over the next four months, however, Goose Island will make its debut across the country and Anheuser Busch is ramping up production.
Goose Island sales reached 150,000 barrels of beer in 2011, which represented an 18% increase over the previous year. In 2012, sales are pegged at another 20% increase.
During last year's NFL season, Dick's Sporting Goods (NYSE: DKS) stock climbed more almost 20%. This retailer is everywhere. In addition to sponsoring the most recent golf open in Endicott, New York, the sporting goods store keeps popping up in new shopping centers strategically placed next to the likes of discounters Target and Marshalls. Were it not for a misplaced investment in UK sports retailer JBJ Sports, the company's second quarter would have been a 'hit' instead of a miss that cost Dicks a 27% drop in earnings. With that in the rear view mirror, Dick's Sporting Goods has since lifted its full-year earnings and same-store sales guidance.
Chip Maker Takes a Dip
Last year, PepsiCo (NYSE: PEP) stock did not particularly benefit during the NFL season but managed to eke out a near 2% gain, which is surprising given its array of chips and other snack food that it makes. Maybe this year, the Doritos Taco Bell combo will help - the pair has sold 200 million of them since the promotion launched in March.
Tonight's (Sept 5th) NFL season opener between my hometown New York Giants and the Dallas Cowboys is sure to kick things off in rivalry fashion after the way last year's decision-making season ended. Incidentally, tonight's game also happens to overlap with the first day of the school year, which I have mixed thoughts about. Nonetheless, my football portfolio comprised of BUD, PEP and DKS is ready -- and with the exception of PepsiCo I'm seeing lots of green on my screen already.
GerelynT has no positions in the stocks mentioned above. The Motley Fool owns shares of Dick's Sporting Goods and PepsiCo. Motley Fool newsletter services recommend Nike and PepsiCo. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.If you have questions about this post or the Fool’s blog network, click here for information.