Lin transfer saga pulls down Madison Square Garden stock
(Reuters) - The possible departure of NBA phenomenon Jeremy Lin from the New York Knicks has pushed down shares of team owner Madison Square Garden Co (MSG.O) 3 percent since Monday, but the stock is not expected to fall much further even if he goes.
The Taiwanese-American player's soaring popularity, dubbed "Linsanity", packed Knicks games at the Garden and helped the company negotiate a more lucrative cable deal with Time Warner Cable (TWC.N) earlier this year.
However, analysts played down any long-term impact on the stock if the Knicks fail to re-sign their star point guard.
The Knicks have until just before midnight New York time Tuesday to decide if they will match a $25 million offer made to Lin by the Houston Rockets.
"I think the gain in MSG shares earlier in the year as well as the Jason Kidd incident/potential Lin loss that hit the shares yesterday and today has already efficiently been reflected in the stock movement," said Miller Tabak analyst David Joyce.
Kidd, a new Knicks signing and former NBA All-Star, was involved in a drunk driving crash in the early hours of Monday morning that could affect his marketability to fans.
Lin's loss could also hurt some sporting goods stores that sell Lin-branded Knicks merchandise.
A transfer to Houston could hit smaller New York-based retailers like privately held Modell's that sell Knicks merchandise, but would not have a major impact on national chains such as Dick's Sporting Goods Inc (DKS.N) and Hibbett Sports Inc (HIBB.O), said Morningstar analyst Paul Swinand.
"In fact, these jersey changes help sporting goods retailers," Swinand said, adding that a transfer could help sell Houston merchandise.
Madison Square Garden's shares were down nearly 1 percent at $35.74 in early afternoon trade on the Nasdaq.
(Reporting by Chris Jonathan Peters in Bangalore and Yinka Adegoke in New York; Editing by Anthony Kurian)
- Tweet this
- Share this
- Digg this