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These Companies are Investing Heavily in This Year's Super Bowl

Tuesday, January 28, 2020 04:09 PM | Michael Fowlkes

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These Companies are Investing Heavily in This Year's Super Bowl

Whether or not you consider yourself to be a football fan, everyone loves to tune into the Super Bowl, which will be played this weekend in Miami.

This year's game will feature the Kansas City Chiefs and the San Francisco 49'ers. The typical viewership of the Super Bowl is around 100 million people, so advertisers are anxious to get their ads in front of such a large audience and each year spend millions to produce and air their commercials.

This year companies are going to have to spend about $5.4 million for a 30-second commercial spot in the big game. While that sounds ridiculously high for such a short commercial period, companies know that a lot of people watch the Super Bowl mainly because of all the hype surrounding the Super Bowl commercials. Companies pull out all the stops to get in the list of the best Super Bowl commercials, and the attention the 30-second ads can generate are well worth the investment if audiences like the commercials and talk about them following the game.

Here are a few companies that are more than happy to dish out big bucks to air their commercials during this year's Super Bowl game.

Coca-Cola (KO)

Football fans are used to see Coca-Cola (KO) ads during the big game, but last year the company actually skipped advertising during the Super Bowl for the first time since 2006. The company returns this year with one 60-second ad spot. KO stock is currently trading just shy of its all-time high and shares are trading at 25 times future earnings. The company has done a good job navigating a shift in consumer preference away from sugary soft drinks and analysts expect to see earnings growth of 5% per annum over the next five years. The company will release its fourth-quarter numbers on January 30 with the consensus calling for earnings of $0.43 per share, in-line with the same period last year. KO trades at $57.30 with an average price target of $57.64.

Facebook (FB)

Social media giant Facebook (FB) will run its first-ever Super Bowl commercial this year. The company has purchased a 60-second spot that will feature Chris Rock and Sylvester Stallone. The company has issued a couple of teasers for the upcoming ad spot, one of which you can view here. Facebook will look to advertise the social connections aspect of its Groups feature in the ad as it continues to try to overcome a string of PR disasters ranging from false political ads to misleading ads from personal law firms regarding the safety of Truvada, which is a drug meant to reduce the likelihood of HIV transmission. Facebook continues to do well on Wall Street as traders have been willing to drive the stock higher as the company is only company yet to mount real competition to Google (GOOGL) in terms of online advertising. Earnings are up 42% per annum over the last five years and are expected to rise an additional 13% annually over the next five years. The stock is currently trading at $218.04 with an average price target of $243.70.

Discover (DFS)

Credit card company Discover Financial (DFS) has purchased two 15-second ads during this year's championship, both of which will run during the game's fourth quarter. The idea behind the two ads will highlight the widespread acceptance of the card among retailers and the lack of an annual fee for consumers. Discover has been a strong performer on Wall Street as solid economic conditions and a healthy job market has kept consumer confidence and spending high. Discover has shown investors annual earnings growth of 13.7% over the last five years and looking ahead analysts forecast profits to rise at an annual rate of 10.1% over the next five years. Analysts see a lot of additional upside in the stock. DFS is currently trading at $75.56 with an average price target of $90.11.

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