Celtic is by no means a small football club — it has one of the richest histories in the world — but it is a tiddly AIM stock.
All financial advisers tell investors to stay away from football clubs. But there is an investment case for Celtic.
Football clubs have become increasingly professionalised, and Celtic is the dominant force in its home market, winning the “treble treble” — both cups and the league — in the past three seasons.
An improved Scottish Premier League TV deal will give its 10 clubs about £32 million to share annually from next season, £11 million more than at present.
Last year the Glasgow football club saw its revenues fall after failing to qualify for the Champions League but it has shown that it can buy and sell players successfully, achieving gains on the sales of Moussa Dembele and Erik Sviatchenko.
What could be a real game changer is if UEFA decides to overhaul the Champions League.
Reforms could see the creation of a promotion and relegation system for 2024, with the top 24 teams in the Champions League gaining automatic qualification for the competition. Four places would go to teams “promoted” from a second-tier European “league”, with just four sides qualifying based on national league finishes. Celtic would be guaranteed a spot in the new format.
Finally for investors there aren’t too many options as rival Rangers was delisted from AIM in 2015.
Celtic has a solid investor base including Lindsell Train, which has increased its stake in Celtic to 18.4% this year. Dermot Desmond, the Irish entrepreneur, is the major shareholder with 35%.
In three years the club’s share price has risen from 75p to 162.5p, so it’s definitely worth a look.
