Amazon (AMZN) is closing in on a multiyear deal that could see it acquire rights for the National Football League’s “Sunday Ticket”. Citing people familiar with the matter, CNBC reports that the company is seen as a front runner by others engaged in the talks.
Amazon is an e-commerce company that engages in the retail sale of consumer products. The company also manufactures and sells electronic devices in addition to offering computer storage and database services.
According to CNBC, the league is eyeing a deal of between $2 billion and $2.5 billion per year for the package. Additionally, it wants to complete the deal before February, when the current season ends. DirecTV is the current owner of the rights, with its contract with the NFL poised to expire after the 2022/2023 season.
Amazon is seen as a front runner following NFL commissioner Roger Goodell insisting that the out-of-market Sunday game package will be well suited to a digital platform. Streaming platforms hold an upper hand at the moment as people continue to shun the traditional pay-television system. (See Amazon stock charts on TipRanks)
However, Amazon faces stiff competition for the rights. ESPN chairman Jimmy Pitaro has already reiterated that the “Sunday Ticket” is an incredible product, and its parent Disney (DIS), is already in talks with the league. Apple (AAPL) is another company believed to have shown strong interest as well, according to people familiar with the matter, said CNBC.
A push for the “Sunday Ticket” rights comes on the heels of Amazon agreeing to pay $1 billion a year to become the exclusive broadcaster of Thursday Night Football games. The deal made the company the first-ever streaming service to own NFL broadcast rights.
Recently, Stifel Nicolaus analyst Scott Devitt reiterated a Buy rating on Amazon. According to the analyst, Amazon’s push to build and sell 4K Ultra HD smart TVs will strengthen its penetration into consumers’ homes and increase its digital entertainment service and content.
Consensus among analysts is a Strong Buy based on 31 Buys. The average Amazon price target of $4,200.80 implies 21.09% upside potential to current levels.
AMZN scores a “Perfect 10” on TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations.
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