Tiger Woods Scandal Cost Shareholders of Companies He Endorsed $5 Billion to $12 Billion

Dec 29, 2009  •  Post A Comment

The Tiger Woods scandal cost the shareholders of companies he endorsed between $5 billion and $12 billion dollars, according to a study by two University of California economics professors.

According to a Reuters story, the professors, from UC Davis, wrote in their report that they "looked at stock market returns for the 13 trading days after November 27, the date of the car incident that ignited the Woods scandal. They compared returns for Woods’ sponsors during this period to those of both the total stock market and of each sponsor’s closest competitor. They also reviewed returns for four years before the car accident to build up a comparative picture of the sponsors’ market performance."

In addition, the Reuters story said that the economics professors "called the results statistically significant and said the overall pattern of losses at the parent companies was unlikely to stem from ordinary day-to-day variation in their stock prices."

The professors also said that "Our findings speak to a larger question of general interest in the business and academic communities: Does celebrity sponsorship have any impact on a firm’s bottom line?"

To read the actual study as published by the University of California professors, click here.

–Chuck Ross


  1. Why don’t these companies he endorsed sue the Networks for dragging Tiger’s name through the mud. I think they should pay for their abusive reporting. We’re living in an age of “Alarmist News Reporting”, they’ve taken “freedom of press” to a whole new level. Entertainment shows should not be consider “press reporting”.

  2. Well if they reported anything untrue then by all means, sue them. But it seems to me that the damage is caused by Tiger’s personal life being quite a bit different than the image of Tiger that was being used by and sold to the various companies. If these companies have a complaint, it is with Tiger.
    Also keep in mind that these are estimated losses over a short term and the study seems to have terminated at a low point in the Nike and Pepsi stocks. It would be interesting to see what the long range ramifications are. Nike stock is already ahead of where it was on Nov.27. Pepsi is not fully recovered, but is on the upswing. It seems likely that stockholders would be hard preseed to even perceive a loss except through careful comparative analysis.

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