Original-Research: Borussia Dortmund GmbH & Co KGaA - from NuWays AG Classification of NuWays AG to Borussia Dortmund GmbH & Co KGaA Company Name: Borussia Dortmund GmbH & Co KGaA ISIN: DE0005493092 Reason for the research: Update Recommendation: BUY from: 18.03.2024 Target price: 5.50 Target price on sight of: 12 Monaten Last rating change: Analyst: Philipp Sennewald RS feedback: New formats offering upside / chg.

Original-Research: Borussia Dortmund GmbH & Co KGaA (von NuWays AG): BUY

Original-Research: Borussia Dortmund GmbH & Co KGaA - from NuWays AG

Classification of NuWays AG to Borussia Dortmund GmbH & Co KGaA

Company Name: Borussia Dortmund GmbH & Co KGaA
ISIN: DE0005493092

Reason for the research: Update
Recommendation: BUY
from: 18.03.2024
Target price: 5.50
Target price on sight of: 12 Monaten
Last rating change: 
Analyst: Philipp Sennewald

RS feedback: New formats offering upside / chg.
 
Last week, we hosted a digital roadshow with BVB CFO Thomas Treß, which
underpinned our view that the club is set to benefit from several
structural changes going forward. The main takeaways:
 
Bundesliga broadcasting rights: In Q2, the German Football League (DFL) is
starting to market the media rights for the 4-year period starting with the
season 2025/26. While the current 4-year deal has a total value of EUR 4.4bn,
fears were arising that the next deal could decrease in volume after the
Italian and French Leagues had to cut back recently. However, the recent
abortion of the "No-Single-Buyer-Rule" is set to intensify the bidding
contest. Hence, we do not expect a decrease and conservatively forecast the
deal volume to remain on the same level as in the current period.
 
New UCL. Although UEFA did not disclose final details on the prize money
distribution for the new UCL format, earnings should increase by at least
20% compared to the current format given success in the competition. Yet,
as the share of performance-based premiums will increase by 7.5pp to 37.5%,
the delta is seen to increase, depending on a teams progresses in the
tournament. Moreover, the CWC (click here for more detail) is seen to
provide a liquidity boost in 2025, which is not yet reflected in our model
as no detailed information were released yet by FIFA.
 
Sponsorship upside. While TV marketing or transfer sales are subject to a
certain volatility based on sporting success and talent development, sales
in the sponsoring segment are seen to deliver stable growth going forward.
Both, the expiry of the Evonik and 1&1 contracts next year as well as the
CWC and the associated new sponsorship opportunities in the US are seen to
provide upside in the coming years, in our view.
 
Besides that, BVB reached the quarterfinals of the UCL after beating
Eindhoven last week. As this resulted in EUR 10.6m additional premium
payments, BVB consequently lifted its net profit guidance range by EUR 10m,
which we continue to consider as conservative, given the strong H1. BVB
will now face Atletico Madrid in the quarterfinals. While we rate this as a
50/50 fixture, we conservatively do not model the EUR 12.5m in premiums BVB
would receive if advancing to the semifinals.
 
BVB shares continue to trade on attractive levels of 0.9x EV/Sales,
significantly below the peer average of 3.9x. The stock hence remains a BUY
with an unchanged PT of EUR 5.50 based on DCF.

You can download the research here:
http://www.more-ir.de/d/29175.pdf
For additional information visit our website
www.nuways-ag.com/research.

Contact for questions
Die Analyse oder weiterführende Informationen zu dieser können Sie hier downloaden: www.nuways-ag.com/research.
NuWays AG - Equity Research
Web: www.nuways-ag.com
Email: [e-mail]
LinkedIn: https://www.linkedin.com/company/nuwaysag
Adresse: Mittelweg 16-17, 20148 Hamburg, Germany
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