With Manchester United (NYSE: MANU) having its worst start to a league season in three decades, the stock has been plummeting alongside the soccer team’s poor performances on the pitch. From the yearly high achieved in February, the stock of the English Premier League (EPL) soccer club has dropped by 27%.
After the soccer club’s current manager Ole Gunnar Solskjaer was appointed a caretaker manager in December 2018 Manchester United’s stock rallied from about $17 to a high of $21.92 in February. The stock has since then gone down by 26.96% to $16.01.
Just like on the stock market the soccer club’s performance on the field has been wanting. Currently, they occupy the 12th position in the EPL table with two points above the relegation zone. Sunday’s loss to Newcastle United, who before the match, were in the relegation zone, marked another low for one of the world’s most famous soccer clubs.
Away matches have been especially disastrous for Manchester United. The soccer club last emerged victorious on February 27. This has extended the number of away matches without a win in the Premier League to eight.
This is the worst performance for the club since September 1989 in Sir Alex Ferguson’s third year as a manager of the club. Ferguson is the club’s most successful manager having won 13 EPL titles in his 26 years in charge. But since he retired in 2013 the Premier League title has evaded them and in their current form will be unable to qualify for the UEFA Europa League, let alone the more lucrative UEFA Champions League if they don’t climb the EPL table.
Besides poor performances on the pitch, Manchester United’s plummeting stock coincides with forecasts of reduced annual revenues in the current 2019/2020 season. This is the first drop in half a decade. Additionally, the club expects its adjusted core profit to come in between £155 and £165 million (approximately between $191 million and $203 million).
The expected fall in adjusted core profit will come after Manchester United recorded adjusted core profit of £185.8 million (approximately $229 million) last year. During the same period, the club registered record revenues of £627 million (approximately $772 million) for the 2018/2019 season.
The expected drop has been attributed to the soccer club failing to qualify for the UEFA Champions League. According to Forbes, Manchester United is now the 3rd most valuable soccer club in the world having dropped by eight percentage points in one year. It is still ahead of its EPL rivals such as Manchester City and Arsenal.