Super Bowl Economics — Here’s 2 Hot Stock Tips to Help Investors Join the Party

Between the $7 million ad slots and an average ticket price just shy of $10k, it should go without saying — the Super Bowl is big business.

But, as impressive as these big-ticket, headline-grabbing items might be, they’re just the tip of the iceberg. When it comes to tallying up the full economic impact of the Super Bowl, we start moving into the sorts of figures that are best counted in billions.

Take last year’s host, Arizona, for example. Estimates suggest that the average Super Bowl visitor spent $200-$300 per day to deliver a total economic benefit of close to $1 billion for the state. And this year’s Super Bowl in Vegas is tipped to exceed that, and then some. But more on that later.

And let’s not forget the tens of billions of dollars that flow into businesses far and wide as fans across the country upgrade their TVs (Costco [NASDAQ: COST] sees a 30% uptick in the weeks before the Super Bowl), decorate their homes, and stock up on supplies so they can eat well and… uhh… “stay hydrated”.

In short, the direct economic benefits of the Super Bowl are the stuff of legend.

So let’s take a look at which businesses are set to enjoy the spoils more than others.

If You’re Going to Profit, Look Beyond the Obvious

By far, the biggest beneficiaries when it comes to the enormous economic impact of the Super Bowl are those catering to the non-ticket-holding crowd. These are the businesses selling everything from food and drinks to TVs and decorations.

To put a number on it, this year’s Super Bowl is tipped to generate a record $17.3 billion in retail sales from food, drink, decorations, and apparel alone, according to the National Retail Federation.

Now, naturally, the first instinct here is to assume that a pretty big chunk of that will flow straight into the coffers of a few obvious candidates like Costco [NASDAQ: COST], Albertsons [NYSE: ACI], The Kroger Co. [NYSE: KR], or even Amazon [NASDAQ: AMZN].

But, while there’s no doubt these companies are set to benefit, there’s no reason to expect any sort of unexpected Super Bowl earnings bump once the next reporting season rolls around. The facts of the matter are that, for these companies, the Super Bowl is just business as usual. Or, in other words, any Super Bowl bump is already built into expectations.

That means, if you’re going to look for companies that will truly benefit from this year’s Super Bowl — that is, companies who stand a good chance of delivering way better than expected earnings — you’re going to need to look harder.

Fortunately, we’ve got a couple of ideas.

Super Bowl Winner #1 — Vivid Seats Inc. [NASDAQ: SEAT]

At first glance, Vivid Seats Inc. [NASDAQ: SEAT] might seem like an unusual candidate given the above. As a ticketing platform that’s been selling Super Bowl tickets for a while now, you’d think that anything the Super Bowl can deliver has already been built into expectations.

And, in a way, this is true. And it will also probably remain true in years to come.

But 2024’s Super Bowl stands to blow a few expectations out of the water owing to one important event that slipped by many investors unnoticed — the acquisition of Vegas.com last year for a cool $240 million.

Now, to understand the full impact this could have, we first need to get a few things straight.

1. This year’s Super Bowl is at Allegiant Stadium, smack dab in the middle of Vegas.
2. Vegas is tipped to see a gross economic impact of well over $1 billion from this year’s game.
3. A big portion of that billion-plus figure will be spent by spectators for whom “the unique locale [will turn] the game into a week-long party.”
4. Finally, Vegas.com has become the go-to source for a huge swathe of Vegas tourists looking to secure the best deals on pretty much anything in Vegas.

To put that all together, a bunch of Super Bowl fanatics are descending on Vegas. Those fans will spend over a billion dollars on living it large in Vegas. And Vegas.com will probably see a lot of that action.

Now, as for what this means for investors, let me make it simple.

If Vegas.com can capture just a fraction of this week’s action, it could very well be on the way to delivering a surplus revenue measuring in the tens, or even hundreds of millions of dollars.

And given it belongs to a parent company (Vivid Seats) that saw 2023 Q1 revenues of $161 million, that Super Bowl sales boost could deliver investors a very nice surprise.

Super Bowl Winner #2 — RDE, Inc. [OTC: RSTN]

In bringing you the tip about the Vegas.com Super Bowl boost that could benefit Vivid Seats Inc. [NASDAQ: SEAT] investors, there was an important piece of the puzzle we skipped over — the bit about why we’re so bullish on Vegas.com.

But here, we’re going to dig a little deeper into it, because it’s a big part of why we’re so bullish on our second Super Bowl tip — RDE, Inc. [OTC: RSTN].

So, to get things started, let’s rewind the clock back to November of last year. That was the month when Vivid announced it had acquired Vegas.com for a massive $240 million. It was also the month when we analyzed the deal and asked a couple of tough questions:

• Why did Vegas.com, whose revenues were $48.2 million, warrant a 5x revenue valuation?
• How did Vegas.com increase its valuation by 6x in a few short years leading up to the Vivid acquisition?

Now, the full answer is a lot longer than what we’re going to reproduce here (for the full answer, read this article). But, to give you the tl;dr version, we eventually arrived at two key findings.

First, there was this graph.

And second, there was this Deloitte study.

What was interesting about these two pieces of data was the seemingly conflicting story they told. Especially at the extremes.

To illustrate, look at the most heavily impacted discretionary item on the Consumers’ Spending Intentions report — out-of-home dining/eating. That should have seen a 25% slump.

But then, at the same time, we had Deloitte telling us that most consumers were maintaining (or even increasing) the frequency with which they dined out.

Weird, right?

Well, yes… but no.

While those two data points taken alone might seem conflicting, something else in the Deloitte report explained exactly what was going on. That was the bit about consumers “looking for less expensive options along with promotions and discounts.”

And then the bit that really sold us on the Vegas.com valuation story was the bit about the “60% of consumers [that] said they are unlikely to accept lesser quality,” even though they were chasing “less expensive options.”

In other words, we’re now living in a world where consumers are:

• Intending to spend less on discretionary purchases;
• While still expecting to consume the same number of units;
• While also expecting the same quality as before.

Now,  in case it isn’t obvious yet, the above sets up the perfect storm for anyone playing the discounting game, which is precisely what Vegas.com does. Hence the massive valuation.

Here’s Why This Means Big Things for RDE, Inc. [OTC: RSTN]

As it turns out, all the above also sets up the perfect storm for our second Super Bowl winner pick, RDE, Inc. [OTC: RSTN], which also plays a very similar discounting game through its Restaurant.com and CardCash.com platforms.

Now, as for what either of these businesses have to do with the Super Bowl, let me explain.

To start with, let’s first point out that 16.2 million people plan to watch the 2024 Super Bowl at either a bar or restaurant. And then let’s point out the fact that Restaurant.com is fast growing into one of the nation’s leading platforms for precisely this sort of discount.

And we’re not talking about small discounts, either. For example, here’s a random one I just pulled off of the front page of Restaurant.com for Roamers Lounge & Event Center in Illinois. Currently, it’s offering $25 certificates for $10.

And that means exactly what you think it means — spend $10 on Restaurant.com and receive $25 worth of food and drink.

And if that doesn’t spell out “makings of a platform in hot demand in a climate where consumers expect more for less”, then I don’t know what does.

The same goes for CardCash.com, RDE’s second big platform.

Now, to be clear, CardCash.com is a little more generalist (it trades in just about every major gift card currently available on the market, and then some). The discounts are generally a little more modest, too.

But that’s not to say they’re any less attractive to anyone looking to maximize their hard-earned dollar this Super Bowl.

For instance, remember that stat we quoted about a 30% bump in TV sales in the weeks leading into Super Bowl weekend? Turns out, CardCash.com sells discounted gift cards for companies like Best Buy [NYSE: BBY].

It even has some crossover with Restaurant.com, offering discounted gift cards to places like Texas Roadhouse [NASDAQ: TXRH], Domino’s Pizza [NYSE: DPZ], Pappa John’s [NASDAQ: PZZA], Chipotle [NYSE: CMG], and a bunch of others like Buffalo Wild Wings, Subway, Jimmy Johns, and more.

Why 2024 Will Be Especially Huge for RDE, Inc.

If you’ve been paying attention so far, you might have noticed one big hole in the Super Bowl story for RDE, Inc. [OTC: RSTN]. That is, isn’t the Super Bowl business as usual for Restaurant.com and CardCash.com?

And, if it was any other year, we might agree. But 2023 was a big year for RDE, and a few key developments took place that could set up a dream run for investors.

First, it was only in October of last year that Restaurant.com launched its full-fledged mobile dining app (previously it was a website-first business). This instantly boosted its visibility and availability to millions of diners, setting it up for a massive growth story in 2024.

Second, 2023 was also the year RDE announced its acquisition of CardCash.com at about the same time that Vivid announced its acquisition of Vegas.com. This creates a massive M&A story where huge synergies and cross-promotional opportunities between the two platforms promise to deliver a stellar 2024.

And finally (and this could be the big one), 2023 was also the year RDE put in the groundwork for an uplisting to Nasdaq Capital Markets — a move that could skyrocket its value by 6-7x in the blink of an eye (see this analysis to see why).

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(Featured image by John Seb Barber (CC BY 2.0) via Wikimedia Commons)

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