Formula One is lagging other sport stocks. Why analysts think it's poised to race ahead

Formula One Stock Set to Gain Momentum, Analysts Say Growth Potential Outpaces Other Sports Investments

Imagine your favorite sports team taking a timeout in the middle of the season. Even though they’re not playing, there’s still a lot happening behind the scenes that could change the outcome when they return. That’s exactly what’s going on with Formula One right now—and why investors are paying close attention.

Why Formula One’s Stock Matters for Investors

Formula One, the famous racing league, is owned by Liberty Media. Its stock has been in the spotlight even though the league faced a tough quarter, with revenue dropping almost 40% after some races were canceled due to conflicts in the Middle East. But here’s the twist: the stock price actually went up nearly 4% in one day, showing investors still see a lot of promise.

This is important for investors because sports stocks have been strong, even with inflation making things more expensive everywhere else. For example:

  • The 2026 FIFA World Cup brought in a record $15 billion in revenue (FIFA).
  • Other sports companies are soaring. TKO Group (UFC and WWE) is up 16% in the past year. Madison Square Garden Sports (owners of the Knicks) is up 93%.
  • Formula One’s stock is a bit behind but has strong potential for growth.

The Bullish Case: Reasons for Optimism

  • Growing Popularity: Formula One used to struggle with getting fans. But after Liberty Media bought the league in 2017, things changed. A Netflix series called “Drive to Survive” boosted viewership by 63% from 2018 to 2025.
  • New Deals and Partnerships: The company is signing new TV and sponsorship deals, keeping fans and investors interested. For example, recent renewals with TV networks help keep money flowing in.
  • Room to Grow in the U.S. and Asia: Many Americans still can’t name three F1 drivers, and there’s lots of space to grow in Asia, especially China.
  • Licensing and Products: Analysts think sales of F1-branded toys, games, and movies could double or even quadruple in the next few years, adding millions to revenue.
  • Strong Analyst Support: Big banks like JPMorgan and Morgan Stanley have “buy” or “overweight” ratings on the stock, expecting it to rise up to 21% from its current price.
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The Bearish Case: What Could Go Wrong?

  • Event Risks: Canceled races can seriously hurt revenue, as seen this quarter.
  • High Expectations: With all the hype, if Formula One doesn’t keep growing fast, the stock could disappoint.
  • Heavy Spending: To keep growing, F1 needs to spend a lot on new deals, races, and products. This could mean less money left over for investors in the short term.
  • Competition: Other sports, like the NFL or NBA, compete for viewers and sponsors, especially in the U.S.

Data and Historical Context

Sports entertainment stocks have a history of bouncing back after tough times. For example, after the 2008 financial crisis, the global sports market grew by over 6% per year from 2010 to 2015 (Statista). Formula One is also following a path similar to the NBA, which grew massively after signing big TV and licensing deals in the 1990s and 2000s.

Right now, F1’s sponsorship revenue has grown from $268 million in 2017 to a projected $1.2 billion by 2028, according to Bernstein analysts. Licensing deals with brands like LEGO, Disney, and Mattel could bring in up to $310 million by 2028.

Investor Takeaway

  • Watch for new deals: Keep an eye on Formula One’s new TV and sponsorship agreements—they are a big driver of growth.
  • Diversify: If you’re interested in sports stocks, consider others like TKO Group or Madison Square Garden Sports for balance.
  • Monitor global events: Geopolitical risks can suddenly impact sports schedules and profits.
  • Look for long-term growth: Formula One’s stock may not skyrocket overnight, but its growing fan base and new business deals could pay off over the next few years.
  • Stay informed: Follow news about the U.S. and Asian markets for Formula One, as these could be the biggest sources of future growth.

For the full original report, see CNBC

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