The National Football League (NFL) is back and bigger than ever. The viewership ratings for the first two weeks of the 2023 season have been exceptionally strong. In fact, the first game that kicked off the season scored the biggest ratings yet for Amazon’s (NASDAQ:AMZN) Prime Video broadcasts of Thursday Night Football.
The league just keeps getting bigger as fans flock to support their teams. In 2022, the 32 teams that comprise the NFL generated combined revenues of $18.6 billion, an increase of more than $1 billion from the previous year according to data from Statista. The popularity and viewership of the NFL draw companies large and small into its orbit as corporations use football as a platform to promote their products and services.
Luckily, the NFL is adaptable, increasingly moving into new areas such as streaming and online betting, and striking ever more lucrative sponsorship deals and celebrity endorsements along the way. As the new season gets into full swing, these are the three NFL stocks to buy.
Alphabet (GOOG/GOOGL)
Alphabet (NASDAQ:GOOG/NASDAQ:GOOGL) is arguably the big winner this NFL season as YouTube, which the company owns, has acquired the rights to Sunday night game broadcasts.
“NFL Sunday Ticket, the streaming TV package that lets football fans watch all out-of-market Sunday afternoon NFL games during the regular season. YouTube has taken over Sunday Ticket from DirecTV, which previously held the exclusive rights for the programming going all the way back to 1994.”
Sunday Ticket for the current NFL season is available through YouTube TV, Alphabet’s streaming service.
YouTube is charging $349 for NFL Sunday Ticket when bundled with a subscription to YouTube TV that itself costs $73 per month. Alphabet is trying to recoup the $2.5 billion it is paying each NFL season for the rights to that year’s Sunday Ticket. The company sees the popular Sunday Ticket service as a way to gain market share in the highly competitive streaming sector and to diversify YouTube. While it’s too early to tell how NFL Sunday Ticket will boost Alphabet’s fortunes, early indications are that the service remains a hit on YouTube.
GOOGL stock has risen 47% since the first trading day of January this year.
Apple (AAPL)
Apple (NASDAQ:AAPL) — specifically Apple Music — is officially the sponsor of the Super Bowl halftime show, paying $50 million a year for what is billed as the biggest and most glamorous sponsorship in the world. The company outbid PepsiCo (NASDAQ:PEP) for the halftime show sponsorship, and it can be assumed that Apple will be pulling out all the stops to wring every bit of promotion it can out of the big game, which last year attracted 115 million viewers worldwide.
Apple can be expected to promote many of its products at this year’s Super Bowl and through its association with the NFL, namely its new Vision Pro augmented reality headset that it is planning to release in early 2024. The company is also pushing hard to drive sales of its new iPhone 15. And, of course, it will also use the big game to promote Apple Music. While the performer at this season’s Super Bowl, which takes place on Feb. 11, 2024 in Las Vegas, has not yet been announced, rumored frontrunners are Harry Styles, Taylor Swift and Ed Sheeran.
AAPL stock has gained 40% year to date.
PepsiCo (PEP)
While PepsiCo (NASDAQ:PEP) may have lost its sponsorship of the Super Bowl halftime show after a 10-year run, the company is still a big sponsor of the NFL season and its drinks and snacks are popular choices among football fans. The company spends more than $100 million a year advertising during NFL games, including the playoffs. And that figure does not include the Super Bowl or the previous halftime show that it sponsored. Pepsi also has individual advertising deals with 15 NFL teams, the largest of which is with the Dallas Cowboys.
Pepsi uses its advertising budget with the NFL to promote its popular game day snacks and beverages, including Doritos and Lay’s potato chips, Pepsi and Mountain Dew soft drinks, and, of course, its Gatorade sports drink. Many of these products can be expected to see sales upticks on NFL gamedays. PepsiCo clearly sees the benefit in tying its products to America’s most popular sports league.
PEP stock is down 2% so far in 20203.
On the date of publication, Joel Baglole held long positions in GOOGL and AAPL. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
