This study presents the first analysis of the impact of NASCAR
sponsorship announcements on the stock prices of sponsoring firms. The
primary finding of the study—that NASCAR sponsorship
announcements were accompanied by the largest increases in shareholder
wealth ever recorded in the marketing literature in response to a
voluntary marketing program—represents a striking and unambiguous
stock market endorsement of the sponsorships. Indeed, the 24 sponsors
analyzed in this study experienced mean increases in shareholder wealth
of over $300 million dollars, net of all of the costs associated with
the sponsorships. A multiple regression analysis of firm-specific stock
price changes and select corporate and sponsorship attributes indicates
that NASCAR sponsorships with more successful racing teams, corporate
(as opposed to product or divisional) sponsorships, and sponsorships
with direct ties to the consumer automotive industry are all positively
correlated with perceived sponsorship success, while corporate cash
flow per share (a well-known proxy for agency conflicts within the
firm) is negatively related with shareholder approval.