Amazon (AMZN) plans to throw in the towel in the race for the streaming rights of Indian Premier League cricket matches, valued at $7.7 billion. The move leaves Walt Disney (DIS), Sony Group (SONY) and Reliance Industries in pole position in the race for rights to one of the world’s most popular sporting leagues.
The Sports Portfolio of Amazon
According to the Wall Street Journal (WSJ), Amazon has already spent more than $6 billion to strengthen its operations in India and feels that spending more to stream the league will not make business sense. Meanwhile, Disney and Sony are still in the race as they believe the IPL rights offer a way to dominate the ever-growing Indian consumer market, where the game enjoys a cult-like status.
Amazon has been spending big on sporting events to draw more people to its platform. It has already spent millions of dollars on European soccer rights. It has also inked a $1 billion deal for Thursday Night Football in the US.
The tech giant had also identified the IPL as one of the half dozen global franchises to bolster its sporting portfolio. The IPL comprises ten teams, with players from countries that play international cricket, and draws in more than half a billion viewers. It only trails soccer in popularity globally.
Wall Street’s Take
Goldman Sachs analyst Eric Sheridan has reiterated a Buy rating on Amazon stock and lowered the price target to $170 from $185, implying 55% upside potential. According to the analyst, the company faces slower E-commerce growth amid macro headwinds that continue to impact the global consumer environment.
The rest of the Street is optimistic about the stock, with a Strong Buy consensus rating, based on 36 Buys, one Hold, and one Sell. The average Amazon price target of $179.7 implies 70.2% upside potential from current levels.
Blogger’s Opinion
According to TipRanks data, financial blogger opinions are 92% Bullish on AMZN, compared to a sector average of 68%.
Key Takeaway for investors
Amazon has taken a significant hit in the wake of the broader market corrections from record highs amid inflationary pressures coupled with an uncertain economy. However, the correction means the stock is trading at a discount going by its robust empire built around E-commerce, cloud, and streaming.
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