UBS Initiates Coverage on Manchester United and Juventus

UBS has launched research coverage on two prominent European football clubs, Manchester United (NYSE:MANU) and Juventus, offering contrasting assessments.

Manchester United

The financial services firm has a positive outlook for Manchester United, highlighting its strong revenue base that positions the club for a return to profitability and competitive performance. UBS sets a price target of $23 per share and gives it a "Buy" rating.

Analyst Ivar Billfalk-Kelly noted, "We see the real upside to the equity story linked to an eventual return to the more lucrative Champions League, a scenario which could potentially drive revenues to £800m."

He added that with a superior revenue base compared to most peers, Manchester United has the ability to invest in talent, predicting that performance will improve leading to Champions League participation from the FY28 season.

UBS believes the club's financial strength, combined with new management focusing on cost management, positions it to compete for top spots in both the Premier League and Champions League. The firm's optimistic outlook is bolstered by the keen interest in sports teams from private equity and wealthy individuals, enhancing the club's valuation.

Juventus

Conversely, UBS is less optimistic about Juventus, initiating coverage with a "Sell" rating and a price target of €2.90 per share. Despite Juventus' commendable on-field performance and relatively high revenue base compared to Italian peers, UBS foresees limited revenue growth opportunities.

The firm stated, "We see future profitability dependent on either 1) a sustainable return to the elite of European football with improved performance in European competitions, which could be difficult given the club’s lower revenue base compared to many European peers, or 2) higher cost reductions than we forecast without sacrificing performance—a challenging balance to achieve."

UBS anticipates a broadly break-even result for Juventus during their forecast period, estimating revenue to exceed €500 million, but sees restricted potential for further growth.