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Lack of confidence reflected in Manchester United’s low stock price

Jan 14, 2014, 2:29 PM EDT

Britain Soccer Premier League AP

There are no voting rights. There aren’t going to be dividends, and the holders aren’t going to wrestle away control of the club. Manchester United stock is all about day trader gambling and fans being part of their team. When the price falls, people are either realizing the stock has no real value or they’re losing confidence in the club.

With Manchester United’s stock hitting a 12-month low on the New York Stock exchange, fans seems to be expressing the latter, the current $15.07 price shaving over $250 million off the club’s overall value (according to The Guardian). After the share’s price reaching its highest point in May, when a $19.04 value coincided with United claiming their 20th first division title, share holders have jumped off the United bandwagon, with the club sitting in seventh place after 21 rounds of the Premier League season.

There are other possible explanations for the sell off. Perhaps, after over a year on the market, the stock’s been found out as less of a stock and more of a glorified fan club membership. In better times, people may be willing to buy into that concept, but as economic recovery continues to be measured in the United States, perhaps people are simply allocating their money elsewhere. Or maybe this is just a natural cycle United’s stock will always endure, dipping in the winter only to rise at the beginnings and ends go each season.

Traded for less than 17 months, the stock doesn’t give us a lot of data to go on, yet there are a couple of pesky coincidences. When Manchester United was doing well, the fans’ mood seemed to be at its highest, as was the stock price. Now, with the Red Devils seventh and fans debating the extent to which David Moyes is contributing to that failure, the stock price is lower than it has been since its initial months of trading.

In August 2012, Manchester United offer shares on the New York Stock Exchange after originally planning to offer shares in Singapore. Ten percent of the club was opened up at $14 per share, with the stock’s price dipping over the next two months. Beginning October 2012, however, the price steadily climbed over the next four months, reaching $18.66 in Feb. 2013. Since, the stock has typically been traded between $15.92 (June 2013) and that February high, until its recent swoon.

On Dec. 6, “MANU” sat at $17.54 per share.  By Dec. 20, it was down to $15.20. In the three weeks they’ve followed, the stock’s shown little sign of recovery, never eclipsing $15.57 since December fall.

Manchester United’s stock holders may just be realizing the limits of their purchase, but for most people, stock ownership isn’t about voting rights and dividends. It’s not even about being fans of the product. It’s about a bet. You just want to make money. Right now, investor confidence appears to be pretty low.

  1. fanofevilempire - Jan 14, 2014 at 3:05 PM

    I doubt Man U fans care, they are more worried about the team on the pitch.

  2. dfstell - Jan 14, 2014 at 3:57 PM

    This is 100% related to Manchester United’s dipping expectations. It isn’t that the investors just realized that the stock carries a very limited ownership interest and doesn’t pay dividends or anything. That stuff all gets factored into the stock within a day or so. Remember after September 11 when the stock market was closed for a few days? Remember how when the stock market came back there were some folks who said that the most patriotic thing we could do would be to buy some stock? Well….the markets did open higher that first morning by a few hundred points, but within an hour or so, rational sense prevailed and the market was down.

    That’s just how it works. Investors are seriously concerned about the club. Not just Moyes, but they are probably questioning whether anyone there knows what they are doing and how to fix the problems they now face.

  3. unclemosesgreen - Jan 14, 2014 at 5:30 PM

    This stock has been diving more than Januzaj & Ashley Young put together.

  4. mianfr - Jan 14, 2014 at 6:08 PM

    Other companies that will never cease ownership, come with few voting rights: Berkshire Hathaway, Google, Facebook.

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