The Motley Fool

Best stocks to buy now: Can one of the biggest football club’s stocks boost my portfolio?

Image source: Getty Images.

Manchester United (NYSE:MANU) is one of the most recognisable and successful sports teams in the world. It is on my best stocks to buy now list and I want to explore whether it would be a good addition to my portfolio.

Manchester United’s share price

As I write this, the Manchester United share price is trading for just over $17. It was boosted by news of a record shirt sponsorship deal with software giant TeamViewer last week. A week earlier, its price faltered after the news that 5m shares were being sold by the Glazer family, who own a majority stake. This equates to 3% of total shares. 

5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!

According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…

And if you click here we’ll show you something that could be key to unlocking 5G’s full potential...

Prior to the market crash back in March last year, MANU’s share price was over $20. At its lowest point in the crash, shares were trading for just $12 which is a 40% drop. Since that low, its price has been fluctuating for a number of reasons, some of which I have mentioned.

The Covid-19 pandemic has massively impacted Manchester United and its income, but more on that later. I still believe at its current price, there is an opportunity to pick up cheap shares, which is why I place it on my best stocks to buy now list.

Football without fans

The past year has seen the absence of fans within stadiums. Manchester United possesses the largest club football stadium in the UK, boasting an attendance of over 74,000. Naturally, the Covid-19 crisis has affected revenue as it is estimated match day revenue can total approximately £6m per home game.

In a recent trading update, Manchester United posted a £63.9m profit for the three months to 31 December. Total revenue rose by 2.6% to $172.8m compared with the same period last year. Match day revenue fell 96% due to the pandemic. Commercial revenue declined 11% but broadcasting revenue rose 68%. This timely boost would have been due to the Premier League’s promise to broadcast all league games as fans cannot attend stadiums yet. MANU is one of the most broadcast sports teams across the world.

Best stocks to buy now still present risks

Manchester United has a lot of debt. Currently, it stands at over £400m. This can affect operations off the pitch, which in turn affect performances on it and fan appeal, which affect marketability. The club has not won any silverware for four years now. Furthermore, the sale of almost $96m worth of stock from its owners could also be a sign of those at the top cashing in on a company they may not have utmost faith in either. 

I believe the current Manchester United share price is a bargain. With the vaccine rollout, I believe fans will return to stadia and match day revenue will roll in once more. Furthermore, the recent sponsorship deal worth $275m (a world record amount, matching FC Barcelona’s £47m a year deal) will boost the coffers and investor confidence.

On the pitch, Champions League qualification is beginning to look a certainty for next season. The extremely lucrative European club competition boosts income and worldwide profile massively.

Manchester United is firmly on my best stocks to buy now list as I believe it could be a contrarian reopening stock and enhance my portfolio. I am also looking at other alternatives like this FTSE penny stock for my portfolio.

FREE REPORT: Why this £5 stock could be set to surge

Are you on the lookout for UK growth stocks?

If so, get this FREE no-strings report now.

While it’s available: you'll discover what we think is a top growth stock for the decade ahead.

And the performance of this company really is stunning.

In 2019, it returned £150million to shareholders through buybacks and dividends.

We believe its financial position is about as solid as anything we’ve seen.

  • Since 2016, annual revenues increased 31%
  • In March 2020, one of its senior directors LOADED UP on 25,000 shares – a position worth £90,259
  • Operating cash flow is up 47%. (Even its operating margins are rising every year!)

Quite simply, we believe it’s a fantastic Foolish growth pick.

What’s more, it deserves your attention today.

So please don’t wait another moment.

Get the full details on this £5 stock now – while your report is free.

Jabran Khan has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Our 6 'Best Buys Now' Shares

Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.

So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we're offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our 'no quibbles' 30-day subscription fee refund guarantee.

Simply click below to discover how you can take advantage of this.