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NBA, Formula 1 Announce Content And Promotion Partnership
NEW YORK – The National Basketball Association (NBA) and Formula 1® (F1) today announced a first-of-its-kind content and promotion partnership to bring together the broad, global fanbases of the NBA and F1 in celebration of the NBA's 75th Anniversary season and the return of F1 to the U.S. At the 2021 FORMULA 1 UNITED STATES GRAND PRIX™ on Sunday, Oct. 24 in Austin, Texas.
To commemorate the US Grand Prix and the NBA's 75th Anniversary season, exclusive imagery featuring F1®cars in custom liveries representing all 30 NBA teams will be dropped on NBA and F1 social channels around the world, with the first 10 cars showcasing the Central and Pacific Divisions being unveiled today.
On Thursday, Oct. 21, ESPN will host F1 drivers as they battle it out off the track in a free throw challenge at an NBA 75th Anniversary-themed basketball half-court within the Circuit of the Americas paddock. NBA legends will be onsite to meet the drivers and provide shooting tips as they compete to make the most free throws out of 10, with $20,000 up for grabs to be donated to the winner's charity of choice.
The 2021 FORMULA 1 UNITED STATES GRAND PRIX™, which will take place from Oct. 22-24, 2021, has been held at the Circuit of the Americas track in Austin, Texas since 2012, with Formula 1® returning to the iconic track following a two-year break due to COVID-19. The race will air on Sunday, Oct. 24 on ABC, with live coverage starting at 1:30 p.M. ET.
The NBA has established a major international presence with games and programming available in 215 countries and territories in more than 50 languages, and merchandise for sale in more than 100,000 stores in 100 countries on six continents. NBA rosters at the start of the 2021-22 season featured a record 121 international players from 40 countries.
The NBA's 75th Anniversary season tipped off on Tuesday, October 19 and continues tonight with Kia NBA Tip-Off's doubleheader on ESPN as the New York Knicks host the Boston Celtics (7:30 p.M. ET) and the Denver Nuggets visit the Phoenix Suns (10 p.M. ET). TNT will have a doubleheader on Thursday, Oct. 21 (Dallas Mavericks at Atlanta Hawks, 7:30 p.M. ET; Los Angeles Clippers at Golden State Warriors, 10 p.M. ET), and ESPN will have a doubleheader on Friday, Oct. 22 (Nets at Philadelphia 76ers, 7:30 p.M. ET; Suns at Los Angeles Lakers, 10 p.M. ET).
Formula One Group: Valuation May Be Full Here
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A Quick Take On Formula One GroupFormula One Group (NASDAQ:FWONK) reported its Q2 2023 financial results on August 4, 2023, beating revenue but missing EPS consensus estimates.
The firm operates the global Formula 1 motor racing series.
Given questions about a current pricey valuation, uncertain future growth potential with an already crowded calendar and apparent difficulty in adding new teams, I'm Neutral [Hold] on Formula One Group for the near term.
Formula One Group Overview And MarketEnglewood, Colorado-based Formula One Group was acquired by parent firm Liberty Media (LMCK) in 2017 at a then enterprise value of around $8 billion.
The firm is headed by President and CEO Stefano Domenicali in collaboration with Liberty Media President and CEO Greg Maffei.
The company operates the Formula 1 racing series, but is subject to the sporting oversight of the Federation Internationale de l'Automobile, or FIA.
Formula One is a global racing series featuring arguably the most advanced open-wheel racing cars in the world.
The company generates revenue from the following sources:
Media rights, selling broadcasting rights to Formula One races to broadcasters around the world.
Licensing the Formula One brand to companies that want to produce merchandise or other products and services.
Sponsorships sold to companies that want to be associated with Formula One.
Event fees from charging teams and circuits fees to participate in Formula One races.
According to a market research report by IndustryARC, the global market for motorsports of all classes was estimated at $8 billion in 2022 and is projected to reach $12.9 billion by 2027.
This represents a forecast CAGR of 10.2% from 2023 to 2027.
The main drivers for this expected growth are the rising popularity of Formula 1 racing and the continued launch of additional racing classes in numerous regions.
Also, the chart below shows a breakdown of the industry's various revenue streams by type, as of 2021:
Global Motorsports Market (IndustryARC)
Major competitive or other industry participants include:
NASCAR
NHRA
MotoGP
Indycar
ARCA
WRC
WTCC
WEC
Superbike
Supercross
Motocross
Supercar
Total revenue by quarter has fluctuated unevenly and shows seasonal variations; Operating income by quarter has also varied within a range:
Total Revenue and Operating Income (Seeking Alpha)
Gross profit margin by quarter has produced no clear trend; Selling and G&A expenses as a percentage of total revenue by quarter have trended slightly higher in recent quarters:
Gross Profit Margin and Selling, G&A % Of Revenue (Seeking Alpha)
Earnings per share (Diluted) have produced greater volatility in recent reporting periods, as the chart shows below:
Earnings Per Share (Seeking Alpha)
(All data in the above charts is GAAP)
In the past 12 months, FWONK's stock price has risen approximately 7.39%:
52-Week Stock Price (Seeking Alpha)
For balance sheet results, the firm ended the quarter with $1.49 billion in cash and equivalents and $2.95 billion in total debt, of which $27.0 million was categorized as the current portion due within 12 months.
Over the trailing twelve months, free cash flow was an impressive $388.0 million, or $1.66 per share, during which capital expenditures were $220.0 million. The company paid $19.0 million in stock-based compensation in the last four quarters.
Valuation And Other Metrics For Formula One GroupBelow is a table of relevant capitalization and valuation figures for the company:
Measure [TTM]
Amount
Enterprise Value / Sales
6.7
Enterprise Value / EBITDA
33.1
Price / Sales
6.2
Revenue Growth Rate
59.0%
Net Income Margin
19.0%
EBITDA %
20.2%
Market Capitalization
$15,730,000,000
Enterprise Value
$17,220,000,000
Operating Cash Flow
$608,000,000
Earnings Per Share (Fully Diluted)
$1.67
Click to enlarge(Source - Seeking Alpha)
Sentiment AnalysisBelow is a word count chart showing the incidence of positive and negative words in management's most recent earnings call:
Earnings Transcript Key Terms Frequency (Seeking Alpha)
The chart above shows a relatively benign sentiment from analysts and management.
Analysts on the call asked about the usage of the Las Vegas Paddock building for other purposes throughout the year and about the prospects for adding another team to the series.
Details were scant on Paddock building usage. It appears, at least publicly, that management is cool to the idea of adding a new team to the series.
The new team in question is the putative Andretti/Cadillac team that wants to become the eleventh team in the series.
The issues are related to a division of the existing pot of money and whether the new team would simply reduce other teams' money while not adding enough new interest to the series to offset the reduction on a per team basis.
Commentary On Formula One GroupIn its last earnings call (Source - Seeking Alpha), covering Q2 2023's results, management highlighted their hopes for the Las Vegas Grand Prix, which represents a major investment by the company in the American market.
Leadership also noted growth in viewership and said that four of the races through the first half of 2023 had been sold out.
Online viewership has increased by 29% in the first half of 2023 versus the same period in 2022.
Total revenue for Q2 2023 fell 2.7% YoY on one fewer race due to the cancellation of the Imola race. Gross profit margin remained essentially flat.
Selling and G&A expenses as a percentage of revenue rose by 0.4% year-over-year, while operating income increased by 6.1% to $52 million.
The company's financial position is reasonably strong, with ample liquidity, nearly $3 billion in long-term debt and substantial free cash flow.
Looking ahead, consensus revenue growth estimates for 2023 are at 26.7% over 2022.
If achieved, this would represent an increase in revenue growth rate versus 2022's growth rate of 20.46% over 2021.
Regarding valuation, in the past twelve months, the firm's EV/EBITDA valuation multiple has risen 14.2%, as the chart from Seeking Alpha shows below:
EV/EBITDA Multiple History (Seeking Alpha)
A potential upside catalyst to the stock could include a successful Las Vegas Grand Prix race later in 2023.
However, the valuation of the stock appears priced for perfection, whether looked at from an earnings or free cash flow basis, as the discounted cash flow calculation shows below:
Discounted Cash Flow - Formula One Group (GuruFocus)
The above chart shows the free cash flow DCF at $1.66 per share and at a generous growth rate assumption. The EPS version is largely the same, indicating the shares appear to be substantially overvalued, given a long-term growth rate of 15% per year.
So, while Formula One is a growing sport, it is unclear whether the governing structure is suited to adding new teams that might bring additional interest to the sport, such as the Andretti/Cadillac effort.
Given the apparently priced-for-perfection stock price and questions about future growth potential with an already crowded calendar and difficulty in adding new teams, I'm Neutral [Hold] on Formula One Group for the near term.
10 Gifts For The Ultimate Formula 1 Fan In Your Life
Image Source: Pottery Barn Abercombie & Fitch
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If you have a Formula 1 fan in your life, you know how passionate they can be about the global motorsport. From trying to convince you to watch Netflix's "Drive to Survive" to sending you hilarious clips of the drivers, their love for the sport truly goes beyond the circuit. Although it may be tough to score tickets to a race, the next best thing is getting them a gift that celebrates their love for all things F1. To help you find some of the coolest, most unique picks, we rounded up the best gifts you can give the ultimate F1 fan.
Nothing shows their love of the motorsport like some cute gear. Instead of sponsor-heavy merch, we found some stylish pieces from Pacsun's official Formula 1 collection and Abercrombie's vintage-inspired McLaren line. Plus, we had to include some cheeky finds from Etsy and some street-inspired sneakers, so they can look as fashion-forward as Lewis Hamilton. Shopping for an avid reader? You can get them a stylish, leather-bound coffee table book about the 70-year history of the high-octane sport or the Haas F1 team principal Guenther Steiner's new book "Surviving to Drive: A Year Inside Formula 1."
Whether they're #TeamRedBull or #TeamMercedes, there's no doubt that they'll appreciate these gifts. Shop our top picks ahead.
Best Building Kit For Formula 1 FansLego 42141 Technic McLaren Formula 1 2022 Replica Race Car Model Building Kit ($169, originally $200)
Shopping for someone who loves to build things? Get them this Lego set where they can build their own version of McLaren's 2022 race car. With 1,432 pieces, this Lego car is equipped with a V6 cylinder engine with moving pistons, a steering wheel, and more. It's perfect for the collector in your life.
Lego 42141 Technic McLaren Formula 1 2022 Replica Race Car Model Building Kit
$169 from amazon.Com
$200 $169 Now 16% off
from amazon.Com
Buy Now Best Coffee Table Book For Formula 1 Fans"F1 Heroes" Leather-Bound Book ($169)
Elevate their home with a stylish and bold decor piece like this "F1 Heroes" coffee table book. It lets them display their favourite sport without looking too cheesy. Plus, the book has 70 years of racing history, including pictures from races, engineering feats, and so much more.
"F1 Heroes" Leather-Bound Book
$169
from potterybarn.Com
Buy Now Best Gift For McLaren FansAbercrombie & Fitch McLaren Graphic Crew Sweatshirt ($80-$90)
Abercrombie is stepping into the F1 mania via a partnership with McLaren. The brand has vintage-inspired graphic T-shirts and sweatshirts featuring the McLaren car and races. This is a super trendy gift for the McLaren fan in your life.
Abercrombie & Fitch McLaren Graphic Crew Sweatshirt
Buy Now Best Gift For Daniel Ricciardo FansBeats Studio Buds ($100, originally $150)
You may be wondering why a random pair of earbuds are in this guide. Well, it's because the Beats Studio Buds are the go-to earbuds for Daniel Ricciardo. If you're shopping for the ultimate Ricciardo fan, getting them a pair of these pods is subtle and functional. They're noise-canceling with eight hours of listening time (and much more with the pocket-size carrying case). Plus, they're water-resistant and come in other colours as well. Read our review of the Beats Studio Buds.
Beats Studio Buds
$100 from amazon.Com
$150 $100 Now 33% off
from amazon.Com
Buy Now Best Gift For Fernando Alonso FansFernando Alonso The Eras T Shirt ($19)
The Formula 1 fan in your life was probably aware of the supposed dating rumours between driver Fernando Alonso and Taylor Swift. This Eras Tour-inspired T-shirt, which comes in a variety of colours, is a cheeky gift that they'll truly adore — and get a laugh out of. Plus, if they're a Swiftie, you've hit two fandoms with one meaningful gift. You can shop more gifts for Taylor Swift fans here.
Fernando Alonso The Eras T Shirt
Buy Now Best Gift For Charles Leclerc Fans"Oh Nothing Just an Inchident" Dad Hat ($29)
If you're shopping for a Charles Leclerc fan, they'll adore this Dad Hat. Most F1 fans are familiar with young Leclerc being asked about an incident on the race track involving Max Verstappen. And when a reporter asked what had happened, Leclerc responded, "Oh nothing, just an inchident," creating one of the most famous F1 memes. The cap comes in a bunch of different colours, but we recommend the red to match Ferrari.
"Oh Nothing Just an Inchident" Dad Hat
Buy Now Best Sneakers For Formula 1 FansPuma Mercedes AMG Petronas Formula One Team R-Cat Machina Sneakers ($110)
Whether they're a sneakerhead or a Mercedes AMG Petronas fan, we can all agree these are some stylish sneakers. These unisex shoes are perfect for the fashion-forward fan, especially if they want to emulate Lewis Hamilton. The white sneakers have the iconic teal detailing to match the team's colours, plus a Mercedes emblem on the back.
Puma Mercedes AMG Petronas Formula One Team R-Cat Machina Sneakers
Buy Now Best Memoir For Formula 1 Fans"Surviving to Drive: A Year Inside Formula 1" by Guenther Steiner ($26)
Steiner is Haas F1's team principal, but he's mostly known for his bluntness and unforgettable personality on Netflix's "Drive to Survive." If you're shopping for the F1 fan who got into the sport because of the show, this book is something they need to read ASAP. In this book, Steiner talks about the 2022 season and what went down behind the scenes. This is the first time an acting team principal has written a book about a whole season they were a part of.
"Surviving to Drive: A Year Inside Formula 1" by Guenther Steiner
Buy Now Best Race Track Sweatshirt For Formula 1 FansMonte Carlo Circuit De Monaco Sweatshirt ($37)
You can never go wrong with a cosy sweatshirt, especially as the weather gets cooler. This one is inspired by the Monaco Grand Prix, with the circuit depicted underneath and the sectors and DRS zones highlighted. You can get this in a variety of colours as well.
Monte Carlo Circuit De Monaco Sweatshirt
Buy Now
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