The relationship between major-league sports' official sponsorship announcements and the stock prices of sponsoring firms

Cornwell, T. Bettina, Pruitt, Stephen W. and Clark, John M. (2005) The relationship between major-league sports' official sponsorship announcements and the stock prices of sponsoring firms. Journal of the Academy of Marketing Science, 33 4: 401-412. doi:10.1177/0092070305277385


Author Cornwell, T. Bettina
Pruitt, Stephen W.
Clark, John M.
Title The relationship between major-league sports' official sponsorship announcements and the stock prices of sponsoring firms
Formatted title
The relationship between major-league sports’ official sponsorship announcements and the stock prices of sponsoring firms
Journal name Journal of the Academy of Marketing Science   Check publisher's open access policy
ISSN 0092-0703
1552-7824
Publication date 2005
Sub-type Article (original research)
DOI 10.1177/0092070305277385
Volume 33
Issue 4
Start page 401
End page 412
Total pages 12
Editor G. Zinkhan
Place of publication Thousand Oaks, CA, U.S.A.
Publisher Springer New York
Collection year 2005
Language eng
Subject C1
720401 Marketing
1503 Business and Management
1505 Marketing
350200 Business and Management
350204 Marketing and Market Research
350000 Commerce, Management, Tourism and Services
Formatted abstract
This study presents analysis of the impact of “official product” sports sponsorships with the National Football League (NFL), Major League Baseball (MLB), the National Hockey League (NHL), the National Basketball Association (NBA), and the Professional Golfers Association (PGA) on the stock prices of sponsoring firms. The primary finding of the study is that, in the main, announcements were accompanied by increases in shareholder wealth. The 53 sponsors analyzed experienced mean increases in stock valuations of about $257 million. A multiple regression analysis of firm-specific stockprice changes and selected corporate and sponsorship attributes indicates that official product sponsorships with the NBA, NHL, and PGA and those with smaller market shares were associated with the largest gains in share prices. Although corporate cash flow (a proxy for agency conflicts) is statistically unrelated to shareholder approval., sponsorships by high-technology companies were associated with stronger stockprice reactions than otherwise. Finally, product congruence with the sponsored sport was positively related to changes in stock prices.
Copyright © 2005 by Academy of Marketing Science.
Keyword Business
Official
Sponsorship
Event study
Stock prices
Major-league sports
Shareholder wealth
Consumer
Event
Q-Index Code C1

Document type: Journal Article
Sub-type: Article (original research)
Collections: Excellence in Research Australia (ERA) - Collection
2006 Higher Education Research Data Collection
UQ Business School Publications
 
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Created: Wed, 15 Aug 2007, 05:37:12 EST