Manchester United have seen a £225 million rise in their share price after news of a Covid-19 vaccine had been revealed.
The news of a vaccine, developed by Pfizer and BioNTech, broke yesterday and was followed by a near nine per cent rise in the club’s share price, as noticed by football finance expert, Kieran Maguire.
The dramatic rise in Manchester United’s value is expected to come from the closer prospect of allowing spectators back into Old Trafford, with a vaccine expected to allow for a significant relaxing of the rules that has prevented fans from receiving the full matchday experience within side venues.
Speaking to the Manchester Evening News, Maguire discussed how other clubs had benefitted from the news as well.
“If we take a look at some of the other clubs quoted on the stock exchange today across Europe, Borussia Dortmund are up about 10 per cent, Juventus are up by a small bit, Roma are up by a lot," he said.
“The stock markets don't like uncertainty; they're always looking for good news and bad news. They're (United) definite winners as a result of today because of progress in terms of the vaccine.
“There is an element of it being a knee-jerk reaction. Markets tend to get a bit giddy at times. If it is followed by further good news, I think we can expect to see a steady rise in United's share price.
“It was at about 20 dollars at the start of the year I think, it had fallen to about 12 or 13. Manchester United from a business point of view have very good prospects so my expectation is that the share price will continue to rise."
English Premier League Football clubs have been significantly impacted in the wake of the coronavirus pandemic, after it the competition was halted in March and only resumed in late June.
A financial statement released by Manchester United revealed a £118.1 million loss in the financial year ending in June 2020, with £70 million of that loss being directly attributed to the effects of the pandemic. The rise in value will be welcome news to the owners and officials at the club.
Maguire added: “If Boris Johnson says there is a pathway towards football fans returning then that is positive news for football clubs and Manchester United fans would benefit.
“Some markets react to things that aren't linked to football clubs but things outside, as we have seen today with the announcement of the vaccine progress.
“United normally make around £110million every year through the turnstiles and that is by far the highest in the Premier League. The second highest was Arsenal at around £90million so United have the most to gain from a swift return to playing in front of a paying audience.
“We are a long way from that happening because if a vaccine does arrive, it has to be given to those on the front line and football fans aren't. We must put help first, but it is a step in the right direction.
“As the coronavirus dragged on and we saw a second wave in general, share prices have fallen. Manchester United are down about a third over the course of 2020. The reason for that, every time they played at Old Trafford in front of an empty stadium it's around £4million lost revenue.
“There was an initial spike (when clubs returned in June) because the club didn't have to pay as big a rebate to the broadcasters. That was good news at the time.”
It remains unclear when the vaccine will be rolled out across the country, therefore, leading to questions about when football fans will return. However, it now appears to be closer than it ever has been, as reflected by the stock market.
Author: Jake Wilkin