Sphere Leads Sports Stocks in March as Dolan More Than Doubles Stake
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Sphere Entertainment, the operator of the newly opened landmark Las Vegas arena as well as the MSG regional sports network, led all sports stocks in March, gaining more than 20% in the month as CEO Jim Dolan more than doubled his personal stock ownership the past five weeks.
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Sphere was the month’s best performer of the Sportico Sports Stock Index, which tracks the state of the sports business as reflected in 40 U.S.-listed team, media, gear and gambling stocks. The index edged one point higher in March, closing at 1,169. That puts the index up a tad more than 1% for the year, and nearly 12% higher from its debut in 2020.
Dolan entered the year owning nearly 385,000 shares directly of Sphere (SPHR) and has nearly doubled his holdings since the end of February, according to SEC filings. The executive has spent about $19.5 million to add about another 430,000 shares to his ownership, excluding shares held by his wife, children and the Dolan family trusts that control most of the voting stock of the business.
Interestingly, the executive has been selling shares of the two other public companies he leads, venue-owning Madison Square Garden Entertainment (MSGE, up 3%) and MSG Sports (MSGS, down 2%) the parent of the Knicks and hockey’s Rangers. Dolan has sold a total of $20.9 million in both companies in 2024, according to data compiled by market research Vickers—that amount is less after accounting for federal and York State taxes, making Dolan a net cash buyer across the three interconnected companies.”. “Mr. Dolan sold a small portion of his shares—he continues to have significant holdings in both MSG Entertainment and MSG Sports, and also receives company stock as a meaningful part of his compensation,” an MSG spokesperson said in an email.
In Wall Street’s active practice of tea-leaf reading insider moves, executive buying of shares is considered more predictive than their selling. After all, insiders can have a number of valid reason for selling—estate planning, raising cash, a yacht to pay for—but there is only one reason to buy shares: You believe they’re going to go up in value.
In that way, Dolan’s moves have quickly paid off. The highest price he paid for Sphere shares, on March 11, was $47.87. Shares ended the month at $49.08. He started buying shares in late February at about $41.33 a share, according to an SEC filing. In early February, Sphere reported bullish quarterly results, driven mainly by strength in the Las Vegas venue. In particular, Wall Street analysts seem intrigued by the promise the venue will be able to host multiple daily events year-round, from the daytime planetarium-like “Sphere Experience” to evening concerts to late-night, post-concert events.
Less enthusiastically seen by analysts is the RSN segment of the business, with some concerned the deteriorating model for cable sports may weigh down results. “How long a transition takes from linear to streaming and how the consumers consume it and what they pay for it, right, are key issues yet to be resolved,” Dolan told analysts on the February earnings call. If you believe insider buying is a signal, Dolan’s moves suggest he believes MSG Networks won’t hold back Sphere in coming quarters.
Strong results and a bullish outlook also helped a number of other stocks in the Sportico index, 25 of which posted gains in March. Sportradar (SRAD) gained 19% in the month on the back of projections that sports-related revenue will rise faster than official rights costs. In a sign executive selling is often viewed neutrally, Carsten Koerl’s sale of $35 million in Sportradar stock didn’t hurt sentiment. Koerl told Sportico the sale is to pay wealth taxes levied in Europe. Sportradar stock is currently at a seven-month high of $11.64.
Most other sports wagering-related stocks also improved in the month, with Rush Street Interactive (RSI, up 17%) rallying on strength in the merging Brazilian sports wagering and mobile casino market. Also helped by Brazil momentum is Betway parent Super Group (SGHC, up 7%). DraftKings (DKNG, up 7%), Caesars Entertainment (CZR, up 6%), Churchill Downs (CHDN, 1%) and Penn National Gaming (PENN, 1%) also were betting gainers.
The biggest decliner in March was Shift4 Payments (FOUR), which shed 23% after expectations of a takeover were dashed when bids came in lower than anticipated, according to wire reports. The company, which specializes in mobile payments, has been targeting sports arenas for growth, recently adding Yankee Stadium and MetLife Stadium with the acquisition of competitor Appetize. Management also says it will announce a large European stadium deal soon.
Overall, 15 of the index stocks fell in March. Other large decliners were Fubo (FUBO, down 23%), Under Armour (UAA, down 18%) and Genius Sports (down 17%).
The Sportico Sports Stock Index debuted at 1,000 in August 2020. It’s a 40-stock index that is equal weighted, meaning each quarter each of the 40 component stocks are reset to 2.5% of the index. In addition, this quarter two stocks traded only over-the-counter in the U.S.—Juventus (JVTSF, up 15%) and Borussia Dortmund (BORUF, down 1%)—are being dropped from the index due to inconsistently sufficient trading volume in the U.S.
Being added to the index is Amer Sports (AS, up 2%), the parent of Salomon skis and Wilson tennis rackets and balls, among other brands, which held its IPO earlier this year. Ski resort operator Vail Resorts (MTN, down 2%) is also being added. Vail recently reported weaker sales as warm weather hurt results.
(This story has been corrected in the first, third and fourth paragraphs to accurately reflect the numbers of shares in Sphere that Jim Dolan bought. The headline has also been updated.)
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