The Summer 2024 Olympics, one of the most eagerly awaited global events, will commence in Paris on 26 July 2024.
Averaging over three billion viewers across the past four Summer Olympics, this event offers sponsoring brands tremendous outreach.
Companies that partner with the Olympics stand to gain significant business benefits during this action-packed month.
Here are three such companies that you might consider adding to your buy watchlist.
Airbnb (NASDAQ: ABNB)
Airbnb is one of the many worldwide partners of the Olympics.
Airbnb provides a platform for hospitality entrepreneurs to host accommodations and experiences for travellers.
With over 7.7 million listings globally, Airbnb has supported the journeys of more than 1.5 billion travellers.
The company has been a partner since 2019, helping athletes and spectators secure accommodations during the Olympics.
For this year’s Olympics, Airbnb hosts are offering accommodation options across several cities in France such as Paris, Versailles, and Marseille.
This partnership not only enhances the brand’s visibility but also boosts bookings, contributing positively to Airbnb’s financial performance.
The company has reported a fivefold year on year increase in the number of stays booked in Paris for the duration of the Games.
Presently, Airbnb has been delivering strong earnings over the past two years, having turned profitable since 2022.
In the first quarter of 2024 (1Q 2024), Airbnb achieved a 17.8% year on year revenue growth, coming in at US$2.1 billion.
Profits soared by 125.6% year on year to US$264 million.
Airbnb generated a free cash flow of US$1.9 billion during the quarter.
While the surge in bookings due to the Olympics is temporary, Airbnb has a strategy to further expand its presence in the travel hospitality sector.
Acknowledging a low penetration rate beyond its core markets, the company is actively enhancing its platform’s visibility with marketing campaigns.
The Olympics will undoubtedly help the brand gain more awareness among its target audience, thus improving its chances of expanding beyond its core regions.
Anheuser-Busch Inbev (NYSE: BUD)
Sports and beer are synonymous with each other, with beer being one of the most consumed beverages at these events.
For this year’s Olympics, Corona Cero will serve as the official beer sponsor, marking a historic first for the Olympics.
Corona Cero is owned by the beer conglomerate Anheuser-Busch InBev (AB InBev).
Apart from the Corona brand, AB InBev owns other well-known brands like Budweiser, Stella Artois, and Hoegaarden.
AB InBev boasts a diverse portfolio of over 500 brands spanning multiple regions and nationalities.
The company reported a solid set of earnings for 1Q 2024.
Total revenue inched up 2.6% year on year to US$14.5 billion.
This revenue growth was largely driven by sales of its megabrands, particularly Corona.
Net profits rose more impressively at 15.2% year on year, reaching US$1.5 billion, helped by improved gross margins.
Despite these positive financial results, the company has highlighted a slight decline in overall sales volumes, falling by 0.6% year on year.
This was largely attributable to an underperformance in the US market from the declining sales of Bud Light.
However, Europe exhibited strong growth, with increased consumption of Corona.
Corona Cero, the official beer sponsor, is available in 22 markets across Europe.
This Olympic sponsorship is crucial for AB InBev to help offset declining sales volumes, especially in the US.
AB InBev recently issued a yearly dividend of €0.82 a share, marking the third consecutive year on year increase.
Investors can also consider Constellation Brands (NYSE: STZ), a leading beverage company that owns the rights to the Corona brand in the US market only.
Constellation Brands could provide investors with another opportunity to invest in a beverage business other than AB InBev.
Procter & Gamble (NYSE: PG)
Procter & Gamble (P&G) is a global consumer goods conglomerate that manufactures and distributes an assortment of household and personal care products.
Some brands under P&G’s portfolio include the shaving brand, Gillette, and the hair care brand, Pantene shampoo.
P&G has been partnering with the Olympics since 2010, supplying athletes with personal care products for them to excel on the field.
This partnership can help P&G to promote its diverse product range to millions of viewers and fans.
The company announced a consistent set of earnings for the third quarter of fiscal year 2024 (3Q FY2024) ending 31 March 2024.
Net sales increased modestly by 0.6% year on year to US$20.2 billion with net income rising by 10.5% year on year to US$3.8 billion.
Impressive bottom-line performance was guided by improving gross margins, with gross profit margin increasing by three percentage points to 51.2%.
P&G also generated a positive free cash flow of US$3.3 billion for the quarter.
The company declared a quarterly dividend of US$1.0065 a share.
This marks a 7% year on year increase, as well as the company’s impressive 68th consecutive annual dividend increase.
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Disclosure: Aw Kai Rui owns shares of Constellation Brands.
