NEW YORK (TheStreet) — It was billed as the “Fight of the Century.” Two months later, it’s become the score of a lifetime — for both the fighters and investors.
As originally forecasted by TheStreet, the welterweight championship unification showdown between Floyd Mayweather and Manny Pacquiao ended up out-grossing the Super Bowl by a significant margin. Immediately after winning the fight, Mayweather — nicknamed “Money” — received a $100 million check (his take could grow close to $300 million once all pay-per-view receipts are tallied), crushing his own previous $41.5 million purse record set in Sept. 2013 against Mexico’s Saul Canelo Alvarez.
But Mayweather wasn’t the only one who cashed out. Owners of stocks associated with the event did very well, too.
“There are huge benefits for so many companies from large to small, who are directly and indirectly involved with the sporting event like Mayweather-Pacquiao fight or the Super Bowl,” CNBC contributor and CEO of hedge fund Vaspula Capital Jeff Tomasulo said. “For companies like Comcast, DirecTV (DTV – Get Report), CBS (CBS – Get Report), and MGM (MGM – Get Report) and the others, a lot comes down to brand recognition and what their brand represents and is associated with. DirecTV, sold 1.15 million pay-per-views, which is huge. But again, it is the longer term benefits for DirecTV: brand recognition, and being the provider of great events.”
On May 12, Showtime (owned by CBS) and HBO (owned by Time Warner (TWX – Get Report)) announced that the pay-per-view had sold a staggering 4.4 million, crushing the previous record of 2.5 million buys set by the Mayweather vs. Oscar De La Hoya fight in 2007. And at $100 each for individual viewing packages, a relatively high number for any pay-per-view event, the take was enormous, the lion’s share of the $600 million the event brought in altogether.
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Still, that number is nothing compared to the bump many companies saw in their market caps the day the news hit.
AT&T (T – Get Report) — With around 40% of PPV renues, cable and satellite distributors of the PPV broadcast were able to collect sizable profits. AT&T’s U-verse division was one of the main carriers. With the huge success of the event, U-verse continues to produce huge numbers for the AT&T brand, sustaining the momentum from 2014. On May 12, AT&T was trading at $33.66 per share, good for a market cap of $174.80 billion. One day later, it bumped to over $176 billion, peaking at $181.08 on May 18 — a total company value increase of nearly $7 billion.
MGM Resorts — The MGM Grand served as the host location for the fight. The arena was sold out, producing a record gate of $72 million — about $52 million more than the previous record. “In return for hosting that event,” Tomasulo said, “17,000 people came to watch in person in the MGM arena and all those people spent money at the casino and hotel, from gambling, to buying drinks and eating, to possibly staying at the hotel.” On May 12, MGM was trading at $19.12 per share, good for a $10.77 billion market cap. The next day, the stock climbed to $19.36 before surging to $20.51 a little over a week later, good for a $780 million increase (7.27%) in overall stock value.
