Imagine a winning stock play that can be had simply by looking at the sports page. Forget chart watching, P/E ratios, and 52-week highs and lows: Just look at the corporate sponsor of the NFL stadium hosting “Monday Night Football” and do a quick buy the next day if the home team wins.
Stocks of corporate sponsors of the host team’s stadium on the NFL’s longest running prime-time show go up an average of 0.51 percent when the home team wins—and down 0.01 percent if they lose, according to a study by Assaf Eisdorfer, an associate professor at the University of Connecticut’s School of Business, and Elizabeth Kohl, an assistant professor at UConn’s Carl H. Lindner College of Business.
The study, which will be published in an upcoming volume of Critical Finance Review, collected data from 3,399 games during the preseasons, regular seasons, and postseasons of 21 teams with 26 stadium sponsors from 1997 to 2013.
While all regular season home games weren’t taken into effect due to the comparatively lower national exposure of Sunday afternoon games, “Monday Night Football” was its own category because of its prime-time nature and being broadcast on TV across the country—similar to postseason games.
Come playoff time though, the stock play is significantly different and not good news for shareholders. The spread between a win versus a loss for the host team’s stadium sponsor jumps to 0.82 percent, yet either way the stock is dropping—negative 0.19 percent for a win versus negative 1.01 if they lose.
Why the negative both ways? Eisdorfer and Kohl came to the conclusion that the high-pressure, single-elimination playoff format is to blame. A postseason loss ends the team’s season on a down note, while a home win is usually expected (since the home field advantage generally goes to the team with the better record), and a win only guarantees one extra game.
