CRITERION: Do these ASX plays of the day deserve a sporting chance?
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Last weekend a menagerie of lions, magpies, panthers and broncos battled for the silverware across our two major football codes. (Sorry Queensland. Twice!)
How do investors get closer to the action, other than invading the pitch?
While Australians might be reputed for being sport obsessed, we’re not exactly spoiled for choice with ASX-listed sports exposures. That said, a handful are limbering up in the locker room and vying for selection.
Our first ‘team’ through the banner is Catapult Group (ASX:CAT), which purveys wearable analytic devices to more than 3800 elite teams across 100 countries, including the US football and basketball leagues.
If a player is squibbing it, their coach and fitness player will know.
Catapult has also developed a ‘smart football’ with an inbuilt positioning chip. The tool is being used by US football coaches but could also eliminate goal-line scoring controversies for good – all too late for the Adelaide football club, of course…
In the 2022-’23 year Catapult’s revenue rose 9.5 per cent to $US84.3 million ($130 million), 90 per cent from ongoing subscriptions. The company lost a chunky $US31.4 million, but management expects a free cash flow-positive position in the current year.
Then there’s the high-profile Sports Entertainment Group (ASX:SEG), founded by sports journo-turned-entrepreneur Craig Hutchison.
SEG owns the SEN group of radio stations locally and in New Zealand. The company also owns basketball and netball teams, notably the Perth Wildcats and recently picked up the financially-bereft Collingwood netball franchise.
SEG’s full-year revenue grew by eight per cent to $118 million in the year to June 30, but its ever-active asset acquisition program resulted in a $9.3 million net loss compared with a $4.2 million profit last time around.
SEG owes $28.7 million to the Commonwealth Bank – a debt that in theory can be called in at any time – but an unfazed Hutchison asserts the company has “never been in better nick”.
With a litany of collective past player damages claims looming over concussion-related health problems, there are plenty of reasons for sporting codes and clubs to act now.
Minnow HitIQ (ASX:HIQ) has developed a smart mouthguard called Nexus, to measure, manage and mitigate the impact of head knocks. So far 40,000 athletes have been monitored across 490,000 head impacts, with 130,000 assessments carried out.
Last year HitIQ’s revenue grew 26 per cent to $774,000, but let’s hope a loss of just over $5 million won’t be a knock-out blow.
Still on noggin protection, Cogstate (ASX:CGS) is a leading provider of cognitive assessment tools, mainly for Alzheimer’s disease trials.
But the Cogstate assessment is also synonymous with groggy players staggering off the ground for a concussion test.
With $28 million cash, Cogstate is taking the unusual approach (for a small cap) of buying back up to $13 million of its own shares.
Publicly-listed footy clubs are a rarity here. AFL club North Melbourne briefly listed in the 1986, while the late Geoffrey Edelsten owned the Sydney Swans in the 1980s’ razzle-dazzle era.
These days, the ASX listed outlier is the NRL club Brisbane Broncos (ASX:BBL), which boosted half-year earnings by 47 per cent to $3.761 million, on revenue of $39 million (up 28 per cent).
Average attendances were helped by the club having eight home games at Suncorp Stadium, compared with seven previously. Let’s hope the fans stick with them in 2024…
Sadly, a Broncos share could be harder to procure than a game-day ticket, owing to low liquidity: News Corporation accounts for just under 69 per cent of the Broncos register while the private BGM Projects has dibs on another 22 per cent.
This story does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.
The views, information, or opinions expressed in the interviews in this article are solely those of the interviewees and do not represent the views of Stockhead. Stockhead does not provide, endorse or otherwise assume responsibility for any financial product advice contained in this article.