Why the Brisbane Broncos (ASX:BBL) share price up 16% on Tuesday

Brisbane Broncos' shares continue their run into the green on Tuesday.

| More on:
stadium signifying brisbane broncos share price

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Brisbane Broncos Limited (ASX: BBL) share price has stepped firmly into the green during early trade on Tuesday.

Brisbane Broncos' shares are now exchanging hands at 84 cents apiece, a 16% jump from the opening of trade.

Let's investigate further.

Quick recap on Brisbane Broncos

Brisbane Broncos is a sports entertainment business that is best known for its ownership of the National Rugby League (NRL) football team of the same name.

The Brisbane Broncos franchise generates revenue from sponsorships and from sales of its merchandise and memberships.

At the time of writing, Brisbane Broncos has a market capitalisation of $71 million.

What tailwinds are behind the Brisbane Broncos share price lately?

There has been no market sensitive information released for the company on Tuesday.

However, the Brisbane Broncos share price has been on the move since the company reported its half year results in early August.

Brisbane Broncos' share price – significant uptick since August to date

Source: The Motley Fool

In its report, the company recognised a net profit before income tax (PBIT) of $3.17 million, a significant increase from $22,000 a year ago.

This came from revenue recognition of $25.34 million in the half year ended June 30 2021, underscored by an NRL grant of $7.2 million and sponsorship growth of 26% over the year.

One factor that is important to note, is that the performance for the same time in 2020 "reflects the unprecedented negative impact that Covid-19 restrictions had on the Group".

However, in saying this, the company's half yearly PBIT for 2019 came in at $1.3 million. This means the company still grew its profitability in 2021 when backing Covid-19 out of the equation.

Aside from these driving factors, there has been no market-moving announcements that relate to the company.

However, the recent uptick in the Brisbane Broncos share price from 27 August does show an interesting correlation to the NRL finals series.

For example, several NRL finals games are scheduled at the Brisbane Broncos' home ground, Suncorp Stadium. This is in accordance with the NRL competition being relocated to Queensland due to the Covid-19 pandemic.

In other words, this is an anomaly for the 2021 season, as the majority of NRL finals games would otherwise be played in NSW venues located in Sydney.

As a result, the group is set to benefit from revenues associated with crowd attendance at this venue, that are asymmetrical to previous years.

Brisbane Broncos share price snapshot

The Brisbane Broncos share price has posted a return of 93% over the year to date. This extends the gain over the previous 12 months to 110%.

Both of these results have outpaced the S&P/ASX 200 index (ASX: XJO)'s climb of around 25% over the past year.

The author Zach Bristow has no positions in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Gainers

Market up or down
Share Gainers

Here are the top 10 ASX 200 shares today

ASX investors had a rough end to the week...

Read more »

Man in an office celebrates at he crosses a finish line before his colleagues.
Share Gainers

4 ASX 200 shares racing ahead of the benchmark this week

ASX investors sent these four stocks soaring 12% to 18% this week. But why?

Read more »

Man pointing an upward line on a bar graph symbolising a rising share price.
Share Gainers

Why BHP, Coronado Global, EBR Systems, and Whitehaven Coal shares are pushing higher today

These shares are ending the week on a positive note. Let's find out why.

Read more »

a young woman looks happily at her phone in one hand with a selection of shopping bags in her other hand.
BNPL shares

Up 87% since April, why the Zip share price can keep flying higher into 2026

A leading fund manager expects more outsized gains from Zip shares ahead.

Read more »

Person pretends to types on laptop drawn in sand.
Share Gainers

Here are the top 10 ASX 200 shares today

It was a miserly session for investors today.

Read more »

Happy coal miner.
Share Gainers

Up 75% this week, why is this ASX All Ords stock rocketing again today?

Investors are piling into this ASX 300 stock on Wednesday. But why?

Read more »

A young woman smiles as she rides a zip line high above the trees.
Share Gainers

Here are the top 10 ASX 200 shares today

It was a bountiful session for investors this hump day.

Read more »

Man looking happy and excited as he looks at his mobile phone.
Share Gainers

Why Coronado, DroneShield, Lovisa, and Mayne Pharma shares are racing higher today

These shares are having a good time on hump day. But why?

Read more »