Discovery Comms should move on Olympics host cities announcement
The International Olympic Committee is expected to meet today and vote on whether to accept an earlier recommendation from some of its members to award both the 2024 and 2028 Summer Olympic bids at the same time.
In the race are Los Angeles, Budapest and Paris.
Loop Capital analyst David Miller argued that Discovery Communications (DISCA), which has full European broadcast rights to the 2024 edition, may see a fair degree of volatility ahead of this decision.
A Paris win to host the 2024 summer games may drive shares higher, he contended.
Back in 2015, Discovery Communications announced that it had secured full media rights to broadcast the next four Olympic Games in the pan-European region after the 2016 summer games in Brazil,
#LoopCapital’s David Miller pointed out in a note to investors last month. The deal takes effect with the 2018 Winter Games in South Korea, he noted, adding that at the time the host cities for the 2020, 2022 and 2024 had not been announced.
Last month, the International Olympic Committee issued a loose overture that the host cities for both the 2024 and 2028 summer editions would be announced at the same time, with those being either #LosAngeles or #Paris.
The cities have completed the required presentation of their technical plans for staging hundreds of medal events, and the full International Olympic Committee is expected to convene today and vote on whether to accept the recommendation to award both bids at the same time.
According to the Associated Press, however, the IOC may not announce this week which of Los Angeles or Paris will host the 2024 Olympics and which will get the 2028 edition. The latter has been seen as favorite for 2024, 100 years after it hosted its last Olympics, the publication noted, with Los Angeles Mayor Eric #Garcetti and Los Angeles 2024 bid chairman Casey #Wasserman open to look ahead to 2028.
DISCOVERY LOBBYING FOR PARIS:
Loop Capital’s David Miller told investors that #Discovery is “clearly lobbying” for Paris as the 2024 recipient, as that would ensure at least one Olympics within the pan-Euro time zone over the next eight years, which would be critical for advertising. The situation, however, is still fluid, the analyst noted, with no guarantees.
According to some press reports, the #IOC loves LA because most of the venues are already in place, most are relatively new or are being built, the climate is amenable to the athletes, the bid has unanimous public support, and Los Angeles has hosted the games twice before, both profitably, Miller pointed out.
On the other hand, 2024 would mark the 100th anniversary of the last time Paris hosted the games and the Committee has gone on record in recognizing that, he added. The analyst reiterated a Hold rating and $29 price target on Discovery’s shares.
In late Tuesday morning trading, Discovery’s stock is down 0.9% to $26 per share.
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