Man United IPO- Buy or avoid?

The valuation is 95x earnings and 6x revenue, which makes it kind of dangerous in my opinion

Buy it as a keepsake if you're a fan.

The US should abolish the whole b share no voting thing. Manchester united fans want to kick out the glazers

Ya I think the initial price is kind of high with its valuation, so I might pick it up a little down the line

Football isn't good business, everybody knows that.

Its not? Sometimes teams get carried away with spending money they don't have (City) but a team like Man U is one of the biggest if not the biggest sports team around the world. DHL are paying 10 mil quid just to get their logo on the practice warmups. Then again, players are paid high wages and transfers can cost like 30 mil/euro. I guess I don't know how good of a business it is, but there is a ton of money involved.

Thats my line of thinking- sure teams overspend, but in terms of most popular global sport (and the global market is huge) soccer is number one and then most popular soccer team is either Barcelona or Man United, so it seems to be a good investment if the price is right, but I'm not sure if it is.

The Premier League is a credit bubble waiting to burst....its a lot like the investment banks, salaries are too high and the employees are taking too much of the pie. Sky (UK satellite cable co.) recently forked out close to GBP2bn for the 2013-2015 TV rights. Those costs will be passed on to the already financially stressed pay-TV consumer. Stadiums are no longer selling out and petro-dollars from the Gulf and Russia and making it more difficult for teams to run within their means. ManU has an average squad that punched well above their weight last season, I don't see them being competitive for a while with City and Chelsea spending big again.

Alright thanks everyone! I'm assuming then from a financial standpoint it would be best to avoid the IPO then (while it may be cool to say you own .00000000000000000000000000000000001% of Man U, I'd rather have money) so what price do you think it would be best to buy the stock at?

From an investment point of view, this is among the worst IPOs including ZNGA, GRPN and FB. You'll not be getting any dividend or voting rights. This IPO is only ment to pay off the hugh amount of debt the Glazier family stuck ManU with (guess Miller-Modigliani didn't know that capital structure in sports is different than companies). A bad case of a LBO gone bad.

Since European football teams don't have sal.cap. all the biggest clubs are paying a ton of money for the best talent. The trading system isn't the same as in US sports either, meaning that a club can pay $30m for a player, and that is not including his salary, bonus, comp. for goals/matches played. In return the other team free's up a ton of cash that supporters demands to be put into a new player of equal or better caliber.

European football is a financial race to the bottom.

Ridiculous multiple, if I remembered correctly it's got 3x leverage ratio (debt/equity), and founders/chairman are three brothers/cousins.

I would never buy a company that has its top management guys populated by family members.

Not only do sports franchise not last long on public exchanges (Boston celtics comes to mind) but the multiple is so aggressive and unsubstantiated. Furthermore the Glazers will have no obligation to the shareholders as they retain nearly all voting with the dual class equity structure. Also, Man U's revenue is based on expected success and in the ludicrous financial context soccer finds itself in these days its impossible to accurately predict success. While the Glazers might believe in crystal balls or mirrors telling them they're the fairest in the land, I don't. To buy in to this IPO would be irresponsible..the only way it doesn't tank is if enough Man U fanatics buy in which is doubtful as they've already had to scuttle two attempts at IPOs on other exchanges.

Don't buy in initially it's valued a bit too high in my opinion. Wait for it to go down a bit and then buy it. I made this mistake when I bought CHUY too early and it began to go down (I still profited but my profits could have been much greater.)

Thanks everyone. I was thinking of buying if it gets to like $12-13/share, definitely agree from a financial standpoint it's overvalued because of the fact that it's a sports team and the novelty factor is high.

Are you kidding me? They have 26mm in cash on the BS and the interest payment per year is like 40mm+; and they have to place well in the premier league and secure a decent place in the championship/euro cup. All while Ferguson can kick the bucket any day with the Glazer bunch still holding a tight grip on the committee. I see literally a crash-and-burn should there be any match-wise under-performance. Did I mention that the only two reasons they go IPO is to pay interest and for the Glazer family to unload?

This is at best a trading position, a bragging right, or a stance of support from a die-hard fan. Anything investment/financially oriented is literally suicide.

Alright thanks so at what price do you think its reasonable to buy financially? Never?

Any company half a billion in the red is a bad investment, sports related or not. Also with the rise of Chelsea and Man City I don't see Man U keeping up with it current owners or as a public company.

Bayern is so well managed, they have a world class squad and they spend half the money.

ManU's finances have been gutted by the Glazers, I haven't figured out if I want to short this stock or not tho.

No one buys a sports team to make money. Man U is set to trade at 50x P/E, is swamped with debt, has ridiculously overpaid players and no one likes ownership. I think this thing will tumble.

Having said that, if you're a United fan, or want to say you own part of a professional football team, pick up a share at IPO, ask your broker for a paper stock certificate and hang it on the wall. I bought 1 share of Packers stock when they did the offering a few months back knowing that it's completely worthless, won't pay me any dividend, ever, but it's a fun thing to have and hang on the wall. Man U is different in the sense it's publicly traded but I don't see this as a good investment at $16-$20 a share.

This is just like FB. But worse.

anyone shorting?

Short sell as in hours or a couple days?

Isn't MAN U losing money every year and are trying to cut salary? They traded CR9 for $80 mil to make a mere $8 mil profit or something years ago ,and Park Ji Sung this year to save some money.

Hold for the first day and then sell IMO

Bad bad bad

Read a good article about this actually (link below). Kinda agree with the author, staying far away, regardless of any novelty that Man U shares may hold, they are a terrible investment at IPO prices.

http://twoletterworlds.com/trainwreck-the-manchester-united-us-ipo-edit…

Stay away.

Hey,

I definitely agree with the general consensus that the share price is overvalued, and I am short selling the stock. By the way, Bayern and Arsenal are not the only clubs that comply with the Financial Fair Play rules, Real Madrid do as well by the way. In addition, Madrid are the 2nd biggest brand in World Football (ahead of Barcelona), and they have the largest revenue in World Football as well.

Sources: http://swissramble.blogspot.kr/2011/06/real-madrid-and-financial-fair-p… http://www.deloitte.com/view/en_GB/uk/industries/sportsbusinessgroup/sp…

Only die-hard United fans will purchase these stocks, and I think United overestimate the number of fans they have, especially true fans. United claim that 10% of the world's population are United fans, which is definitely overestimated. I think the share price will decrease and short selling could be profitable.

UNCH during the day, down $00.18 in the aftermarket. I'm going to avoid buying until it drops a little bit more and stabilizes.

Wow its up 1.5% today per my iphone stock app, surprising IMHO

Probably should have bought...