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Netflix (NASDAQ:NFLX) The stock plunged into historic turmoil just two years ago, dropping nearly two-thirds of its value in a hurry. Since then, the stock has risen rapidly, and with video games and even live sports likely to be KO’ed, the question remains as to what the next stop for the stock will be.
Netflix recently made waves for partnering with Most Valuable Promotions (MVP) to stream one of the biggest heavyweight boxing matches in living memory: Jake Paul vs. Mike Tyson.
Granted, this match may be more for show than to decide who is the baddest man on the planet (in my humble opinion, this title will always go to Tyson). That said, this big match could be the first of many live sports events with knockout potential for Netflix. The big event takes place on July 20th, and if the streaming experience goes well, Netflix could disrupt the entire sports world. As Netflix moves more aggressively into live sports, I can’t help but remain bullish on the stock.
This may not be the first attempt at live event streaming (Netflix streamed the live sports event Netflix Cup last year), but YouTube influencer and boxer Jake Paul knows how to stream live events. It’s definitely one of the biggest events ever. Butt sitting in the seat. Either way, how will Netflix maintain the potentially record-breaking viewership numbers that are set to watch Jake Paul take on the 58-year-old legendary heavyweight boxer in this event? It would certainly be interesting to see. .
Netflix: Live sports could drive Netflix stock higher in the long run
If Paul vs. Tyson breaks records (could it be the biggest live streaming event of all time?) and the distribution doesn’t fail, I think Netflix could be on the cusp of expansion in the live sports space. This is a guess. Without a doubt, it’s hard to ignore the rise of sports streaming deals in the tech scene these days.
From Apple (NASDAQ:AAPL) and an exclusive agreement to live stream Major League Soccer (MLS) games to YouTube on Apple TV+, owned by Alphabet (NASDAQ:Google) — And with the $2.5 billion per season deal to become the exclusive distributor of NFL Sunday Ticket, cable TV’s last mainstay is finally moving to streaming, creating a “gold rush” of sorts in the sports world. ‘It’s clear what’s happening in the world.
Personally, I believe that Apple’s MLS contract provides a good return on its money. why? Because Lionel Messi has landed at Inter Miami. A soccer legend will captivate the world of viewers as he sets foot on North American soil. MLS may not be as “popular” as the NFL in the US market, but there’s no denying the amount of growth the soccer league has enjoyed in recent years.
Riding on Messi’s incredible popularity, it’s safe to say that Apple sees value in the competitive sports streaming landscape. As other tech giants compete for distribution rights, I think it makes the most sense to stay out of bidding wars and increase value from any partnerships. Apart from the rights to live stream every MLS match, Apple can garner hype with a documentary series that follows Messi’s footsteps and journey to the World Cup.
This series is definitely not just a must-see for soccer lovers. This could be an entry into MLS annual subscriptions. Indeed, one person can really make a big difference. The world will be watching as Messi puts the finishing touches on his career, perhaps by winning an MLS title with Inter Miami. And Apple will be ready to scrape together cash flow. If Netflix wants to make a big splash in martial arts, it might want to follow a similar roadmap to the iPhone maker, beyond simply streaming live sports.
Boxing push could further boost Netflix’s Jab growth
Netflix may be taking a page out of Apple’s boxing strategy by exploring opportunities in the sports streaming space that could offer a big return on investment. There’s no doubt that boxing has lost some of its luster in recent decades due to the influence of mixed martial arts (MMA). But the rise of YouTube influencers like Jake Paul, who compete in serious competition with like-minded people, is making boxing something of a resurgence, especially among younger viewers. This is a big reason.
Feel free to downplay Paul’s boxing ability, but he has contributed so much to the sport. And if the match with Mike Tyson is successful, there’s no doubt that Netflix will look to host more boxing events on its platform, and possibly sign deals with various boxing promotions. . Personally, I think Netflix has a chance to succeed in the boxing space.
In boxing, there is no single professional league that rules them all. Rather, the scene appears to be more fragmented, with many events taking place across many promotions. If Netflix subscribers want more boxing, perhaps there could be some exclusive deals and opportunities to consolidate promotions in the boxing world.
Financial details for the Paul vs. Tyson fight have not been disclosed, but my guess is it will be huge. But he’s likely to have a big TV audience in July, so it might be worth the price.
Additionally, as the company looks to supplement its massive $5 billion World Wrestling Entertainment (WWE) deal with TKO Group Holdings, could this grow by streaming boxing and martial arts as a whole? It may be an indicator of what is going on (NASDAQ:TKO). Although the sports are very different, WWE and boxing are an interesting combination.
If Paul vs. Tyson becomes the first of many fights to be streamed on Netflix, the streamer could find itself in a bind on cable TV.
Is NFLX stock a buy, according to analysts?
TipRanks rates NFLX stock as a Moderate Buy. Of the 41 analyst ratings, there are 27 buy recommendations, 13 hold recommendations, and 1 sell recommendation. Netflix’s average price target is $581.98, suggesting 7.3% downside. Analyst price targets range from a low of $375.00 per share to a high of $700.00 per share.
Bottom line on Netflix and its foray into sports
Only time will tell what direction Netflix will take after the historic Paul vs. Tyson showdown. Either way, I see the boxing scene as having the potential to pave the way for another sports-focused Netflix tier, and I’m sure many people will be willing to pay for it. This is especially true if it means ending expensive cable TV sports packages and exorbitantly priced pay-per-view (PPV) events in the world of martial arts.
I’m sure Paul vs. Tyson is probably the type of fight that most people would be willing to pay a lot of money to see.
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