As our athletes stroke, sprint and shoot their way to Olympics glory, investors may be pondering sports-related plays to raise the bar on their own investment performance.

Despite a sporting reputation as strong as a tube of Dencorub, Australia doesn’t have a listed equivalent to, for example, the New York-listed, US$2.9 billion market cap Manchester United.

Beloved as they are despite an ignominious Olympics campaign, the Matildas aren’t destined for the bourse any time soon. Nor are the Olympics themselves, but it would be a ripper of an IPO.

Exposure to sports assets such as broadcast rights are available through the media companies, but otherwise investors need to dig more deeply to access the $17.8 billion local industry, as loosely defined by research house IBIS World.

One of the few pure-play ASX exponents is Catapult Group (ASX:CAT), which has developed a leading global position in wearable devices and video monitoring to improve athletic performance.

A scouting package enables teams to analyse potential recruits.

Catapult also provides software to the motor racing sector incorporating elements such as timing feeds, GPS positioning, telemetry, race control messages and weather data.

The company has a presence across 40 sports and 4,200 teams, including the US football and basketball leagues.

CEO Will Lopes cites a US$40 billion professional sports technology market across 20,000 elite teams.

This Olympics, the company’s products are being deployed by competing bodies including USA Volleyball, the Brazil Football Confederation, the French Football Confederation, Great Britian Field Hockey and the Brazilian Paralympics Committee.

And before you accuse the Melbourne-headquartered company of being unpatriotic, it also supports the Australian rugby teams.

Catapult reported annualised contract volumes of US$86.8 million ($132 million) for the year to March 2024, with revenues 20 per cent higher at US$100 million

While ‘management ebitda’ was $4.2 million, the bottom line shows a loss of $16.7 million, an improvement on the previous $31 million deficit.

Broker Bell Potter projects a $13.6 million net loss this year and does not expect a profit within the next two years.

Catapult shares have had a strong surge in the fast lane that’d make Ariarne Titmus (or should that be Mollie O’Callaghan?) envious, gaining 65 per cent over the past 12 months for a market cap of a tad over half a billion dollars.

Investors going for gold should remember that Catapult is no spring chicken, having been founded in 2006 via a partnership with the Australian Institute of Sport and the Cooperative Research Centres.

Meanwhile, for track and field athletes, an upstanding performance starts with more fundamental equipment: comfy runners.

An arm of Accent Group (ASX:AX1), The Athlete’s Foot is the country’s biggest athletic and lifestyle footwear retailer.

Accent has been on a margin-enhancing franchised store buyback spree, with 93 of its 155 stores now company-owned compared with 12 out of 146 seven years ago.

At Super Retail Group (ASX:SUL), its Rebel Sport franchise accounts for about one third of its revenue and earnings. However, Rebel sales retreated 3 per cent in the first half, given slower sales of running machines and home training equipment.

A top-end bullying and harassment claim hasn’t overly impacted the share price.

Meanwhile, Sports Entertainment Group (ASX:SEG) has climbed off the canvas after the indebted company sold its Perth Wildcats basketball franchise for $40 million.

Founded by former sports journo Craig Hutchison, SEG owns the SEN radio stations and, among other things, publishes the AFL’s match-day tome, Football Record.

SEG’s June quarter report showed revenue of $31.9 million, up 9 per cent and operating cash inflows of $5.8 million. After paying down some debt the company is still slugging away, albeit a bit groggy.

 

This story does not constitute financial product advice. You should consider obtaining independent advice before making any financial decision.

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.

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