Sponsors of golf superstar Tiger Woods have lost around USD 5 to 12 billion since reports of his extramarital affairs broke out, a new survey has said.
The new study by the University of California, Davis (UC Davis) examined stock market returns for the 13 trading days that fell between November 27, the date of Woods' car crash and December 17, a week after the sports champion announced his indefinite leave from golf.
Two UC Davis economics professors, Victor Stango and Christopher Knittel looked at eight of his sponsors --Accenture; AT&T; Tiger Woods PGA Tour Golf (Electronic Arts); Gillette (Proctor and Gamble); Nike; Gatorade (PepsiCo); TLC Laser Eye Centers; and Golf Digest (Conde Nast).
"Total shareholder losses may exceed several decades' worth of Tiger Woods' personal endorsement income," said Stango, noting that these are separate and much larger than the golfer's own earnings, who before the scandal got about USD 100 million a year in endorsement income, more than any other athlete.
"(This) pattern of losses is unlikely to stem from ordinary day-to-day variation in their stock prices," the researchers said, based on conclusions that the scandal reduced shareholder value in the sponsor companies by 2.3 per cent, or about USD 12 billion.
The study also finds that three sports-related companies -- PGA Tour Golf, Gatorade, and Nike -- have been worst hit, experiencing a 4.3 per cent drop in stock value, equivalent to about USD 6 billion.