Dolan's Rangers Delighted Hockey Is Better Business Than You Know

NEW YORK (TheStreet) -- When bar talk comes to the National Hockey League, there's always a caveat.

It's a regional sport. It's a niche sport. Its popularity will never match that of North America's three major professional sports. And truth be told, all of those things are true.

What is also true as we enter a high-profile Stanley Cup finals between the L.A. Kings and New York Rangers, you might be able to make money off its mini-renaissance thanks to stocks that share in the televising and hosting of the playoffs.

During last year's labor dispute and subsequent lockout, it was widely considered a huge blow to a league desperate for some momentum. What's happened since the lockout ended has made people look somewhat foolish.

Attendance numbers are solid and the game is exciting. Instead of those brutal years when teams played not to lose in the postseason, teams are aggressive and scoring a lot more goals this spring. You have to go back 23 years to find a conference finals that had more goals than this year. In fact, goals-per-game averages are higher than in the regular season, which is a rarity.

On television, the game is strong as ever in Canada, and U.S. rights holder NBC and its parent Comcast (CMCSA) just saw the most-watched hockey game on the NBC Sports Network ... ever.

To make the investment connection, look at the National Football League, National Basketball Association and Major League Baseball as IBM (IBM), Exxon (XOM) and Apple (AAPL) -- big-caps with huge revenue and huge followings.

The NHL is a small-cap, and revenue growth nearly bears out the metaphor.

Revenue for this season -- expected at roughly $4 billion -- will be a double-digit increase over the previous full season of 2011-12 (last season was shortened by a labor lockout).

These revenue numbers are just for the NHL. There are also more than half a million players registered to USA Hockey, and that does not include coaches.

Translation: The NHL is proving it can grow and make money, and the game is bigger than you think in the United States. So, if you are bullish on hockey, tie down your shirt (hockey term; you can look it up), and here are some ways to invest.

There are some major names out there with some degree of leverage in the game of hockey. Nike (NKE) and Comcast are relatively obvious. It is a small component of each business, but since Comcast involves television the upside seems bigger and its exposure to the game is more dynamic.

Comcast heavily invested in hockey. It owns NBC Universal, which has domestic TV rights to the NHL. It also owns rights to the Olympics in the U.S., which uses men's hockey as one of its cornerstones of the Winter Games. 

In terms of numbers, it's a $135 billion behemoth with a small yield. Also, Comcast, at $52.25, is up nearly 28% in the last 52 weeks and has more than tripled since the 2009 stock market bottom.

But the reason to be bullish is Comcast is aggressive about growth. It's going after Time Warner Cable (TWC) and it made a decent-sized bet on the NHL that right now seems to be paying off. When the technology and communication revolutions calm down, Comcast will still be here, making money.

The next stock of note is MSG (MSG).

It owns several valuable properties including basketball's New York Knicks and the New York Rangers, as well as Madison Square Garden, where the Rangers will be playing the Kings in the finals.

Yes, It has other media interests and owns other teams in othersports leagues. But the Knicks, Rangers and the Garden are the core assets. Interestingly, the company's market cap is about $4.4 billion, which seems a bit low considering the new $2 billion sale price of the Los Angeles Clippers.

The stock, at $56, down 2.7% for the year to date, is a few dollars off its highs. But with the Rangers' playoff run the company expects record revenue.

Now might be a good time for the stock, regardless of how you feel about its polarizing chairman, James Dolan, and how he gave all those millions to Isiah Thomas to run the NBA Knicks into the ground several years back.

Let's finish with a name trading in Canada, the birthplace of the game. Instead of looking for analogous names -- like Rogers Communications (RCI), which owns Canadian TV rights, let's take a look at a hockey-focused equipment maker: Bauer. It's more of a pure play than Nike when it comes to hockey equipment and its story is not as well known.  

The company went public in Canada on the Toronto exchange less than four years ago and has been aggressive. Bauer now has more than half of the global hockey equipment business and has even made steps to diversify as it continues to increase hockey market share. 

Just this spring, it purchased Easton-Bell Sports' baseball/softball business. In the sports world, Easton is a great brand and will definitely bring substantial revenue into the company.

It's a growth name that does carry debt and isn't profitable right now. However, if you think hockey is growing, then Bauer is a strong way to play it.

At the time of publication the author had a position in CMCSA.

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

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