Manchester United Share Price Forecast November 2021 – Time to Buy MANU?
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Shares of English Premier League Football Club Manchester United (NYSE: MANU) are in the red today after closing at $15.60 as of November 19th (18:57 EST). As recently as October 6th, the Kevin Glazer Irrevocable Exempt Family Trust and the Edward S. Glazer Irrevocable Exempt Trust, who are the owners of a combined 40.4 million shares of the football club decided to sell of 9.5 million shares via a secondary offering. With the future direction of the football club in question combined with poor onfield performance, MANU shares have taken a tumble recently.
Manchester United – Technical Analysis
According to Manchester United’s financial statement, the market cap of the company is at $2.54 billion with a combined asset value of $1.741 billion. Revenue for 2021 is at $664.75 with a profit margin of -18.66% compared to $640.90 million in 2020.
Oscillators for Manchester United are mostly neutral as evidenced by Relative Strength Index (14)(33.30), Stochastic %K (14, 3, 3)(17.68), Commodity Channel Index (20)(−182.13), Directional Index (14)(29.61) and Awesome Oscillator(−0.53). On the other hand, moving averages such as Exponential Moving Average (10)(15.95), Simple Moving Average (10)(16.04), Exponential Moving Average (20)(16.18), Simple Moving Average (20)(16.13) and Exponential Moving Average (30)(16.40).
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Recent Developments
As mentioned before, the Glazer family announced that they would be selling of 9.5 million shares, with no specific sales price named. Those shareholders who haven’t sold off their shares cant expect any benefit from this deal as companies do not receive cash from sales in a secondary offering. But this also indicates that the company’s ownership won’t be diluted by the sale. The main reason for the share price decline seems to be the fear of investors regarding 9.5 million shares being suddenly put up for sale which is approx. 5.8% of all shares outstanding.
While the sporting side of the football club is well known across the world, the last Q4 2020 earnings call for the period ending October 22, 2020 revealed the business side of things. Manchester United aimed to strengthen its digital and media capabilities during the pandemic, allowing them to achieve higher engagement levels relative to 2019 across all platforms during the fourth quarter. Manchester United achieved over 1.1 billion social interactions, which is 24% higher than last season. As footfall continued to be absent due to the pandemic last year, the football club accelerated the e-commerce initiative throughout 2021. It performed quite well in the Fiscal year 2020, signing eight new sponsorship deals with partners, including Lego, Mondelez and Visit Malta.
Should You Buy MANU Shares?
Manchester United was struggling on the field with many attributing the club’s failures to manager Ole Gunnar Solskjær. However, investors breathed a sigh of relief after Solskjaer’s departure was made public. This has the possibility to drive up share prices in the coming days. Similar situations were seen in the past, where MANU share prices increased after the sackings of ex-coaches David Moyes and Jose Mourinho.
While it’s true that Manchester United has been a consistent dividend provider for a while. However, investors should see a few more years before they feel comfortable relying on it. However, over the last 5 years, earnings per share have been sinking by 60%. Unless EPS can pull out of the nosedive it is in, MANU’s dividend payments are likely to come under some pressure. Based on this, now seems to be a good time to pick up MANU shares, although investors should look at how the club tackles its on-field problems in the following weeks.
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