- If traditions are preserved, South Park’s latest Ozempic storyline could be a near-term high for the obesity drug maker’s shares.
- Companies that are featured prominently in animated comedies often see their stock prices fall the following year.
- “A year after its appearance on South Park, its median stock price has underperformed the S&P 500 by 7%,” Spectra Markets said.
South Park’s latest gag takes aim at the burgeoning market for weight-loss pills like Ozempic, and the special may continue a long tradition of big-name brands being sold shortly after being featured in the animated comedy.
Last week’s “South Park: The End of Obesity” special looked at the growing popularity of Ozempic and Maunjaro as Eric Cartman tries to get his hands on the wildly popular weight loss pills.
But if history is any indicator, investors may be getting a laughing stock.
An analysis by Spectra Markets found that when publicly listed US companies are featured prominently in South Park episodes, their stock prices tend to hit short-term all-time highs.
“A year after its appearance on South Park, its median stock price has underperformed the S&P 500 by 7 percentage points,” said Brent Donnelly, president of Spectra Markets.
The stock in question is thought to have likely peaked in popularity at the time it was mentioned in South Park, much like the contrarian indicator on magazine covers.
“South Park has a 20-plus year history of capturing the cultural zeitgeist, and it’s impossible to argue that anything satirized in South Park isn’t woven into it,” Donnelly said. “By definition, everything featured is well-known and there is a risk of mean reversion after any significant outperformance.”
Shares of Novo Nordisk and Eli Lilly have risen significantly over the past few years as investors value the $100 billion potential of GLP-1 weight-loss drugs.
Since the beginning of 2023, Eli Lilly and Novo Nordisk shares have risen 121% and 97%, respectively, well outpacing the S&P 500’s 40% gain over the same period.
Other companies previously featured on South Park that underperformed on the stock market the following year include cannabis companies MedMen and Tilray, social media giants Twitter and Meta Platforms, and consumer companies Starbucks and Walmart.
However, not all of the companies featured in South Park saw their stock prices peak shortly thereafter, with Microsoft, Yelp and Netflix bucking the trend.
Either way, the research points out that when a company is featured on South Park, all potential upside is likely already priced into its stock price in the short term, and investors shouldn’t be surprised by its underperformance relative to the S&P 500 Index.
“It’s not a bad time to unwind the GLP-1 basket. It’s all priced in,” Donnelly concluded.
