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Why is Manchester United Plc. (MANU) Stock down?
Manchester United Plc. (MANU) stock dropped by 5.80% due to its early exit from the Uefa Champions League. The club's men's team was eliminated from the competition following a disappointing group stage performance, leading to a loss in potential broadcasting revenue.
- Revenue Outlook Adjustment Manchester United has lowered its revenue forecast for fiscal year 2024 to a range of £635 million to £665 million. This is down from the previous guidance of £650 million to £680 million. The adjustment reflects the impact of the Champions League exit on the club's financial expectations.
- Adjusted Earnings Revised In addition to the revenue outlook, adjusted earnings before interest, tax, depreciation, and amortization (EBITDA) have also been revised. The new guidance for adjusted EBITDA is £125 million to £150 million. The adjustments take into account the challenges posed by the early exit from the Champions League.
- Financial Performance in Q1 Manchester United reported a net loss of £25.8 million in its fiscal first quarter. While this loss is narrower compared to the same period in 2022, it still reflects the financial implications of the club's performance and participation in different tournaments. Broadcasting revenue from Champions League matches partially offset the losses.
- Jim Ratcliffe's Role as Minority Shareholder: This financial update comes after new minority shareholder Jim Ratcliffe, founder of Ineos, acquired a 25% stake in the club. Ratcliffe has expressed his commitment to restoring Manchester United's former glory. He expects the deal to be ratified by various authorities, including England's Premier League, in the coming weeks.
- Future Revenue Expectations: Despite the challenges faced, Manchester United PLC expects full-year revenue in the range of $804 million to $842 million. The club remains focused on its financial performance and future prospects in the world of soccer.
Shares of Manchester United Ltd. Class A (MANU) dropped by 10.41% from $19.98 to $17.90 in the trading on Monday, October 16, 2023. The reasons why MANU stock down include:
- Failed Bidding War: Investors were disappointed as [the bidding war[(https://www.fool.com/investing/2023/10/16/why-manchester-united-stock-is-losing-today/) for Manchester United did not yield the high-value outcome they had anticipated. British billionaire Jim Ratcliffe is reportedly close to acquiring a 25% stake in the club, but the deal falls short of the big payout some investors were hoping for.
- Qatari Group's Withdrawal: MANU stock plummeted by 10% following news of the Qatari group's decision to withdraw from acquiring the football giant. The acquisition process faced challenges, including bidders' inability to meet the high valuation set by the Glazer family, internal disputes, and concerns raised by minority stakeholders.
Manchester United reportedly pulled off the market as controlling shareholders were dissatisfied with bids falling short of their £10 billion asking price. Share prices tumbled up to 18.22%, reflecting investor disappointment. The Glazer family might consider selling again in the future, given improved economic conditions and potential for increased interest in English soccer.
https://www.fool.com/investing/2023/09/05/why-manchester-united-stock-is-down-big-today/
MANU's stock fell 4.45% amid concerns that the completion of the Glazers' club sale is unlikely to occur any time soon.
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