Liberty Media’s Formula One Group takes the “pole position” for TD Cowen’s best ideas in 2024. Despite concerns that interest in Formula One is reaching a ceiling, as well as growing fragmentation in sports broadcasting rights, the firm thinks the company isn’t being properly recognized by investors. “We view FWON as a capital-light royalty on the growth [and] monetization of a premium global sports league,” analyst Stephen Glagola wrote in a Wednesday note. The company’s contracted revenue and variable cost structure provides low execution risk and resilience against potential weaknesses in consumer spending, he added. TD Cowen has a $90 price target on Formula One, implying 60% upside potential from Tuesday’s close. Glagola noted that Formula One remains underpenetrated in the U.S. market despite 19% year-over-year TV subscription growth from January through October. Race attendance trends in North America were also positive in 2023 from the previous year, he added. Furthermore, the company’s “highly contracted” revenue and its variable cost structure also minimizes execution risk and defense against a potential economic pullback, Glagola said. He forecasts more catalysts next year with the return of the China Grand Prix for the first time since 2019. Overall, there will be 24 Formula One races in 2024 compared to 22 in 2023, and profit from the Las Vegas Grand Prix should rise from 2024 onwards, said Glagola. “We expect favorable structural tailwinds including market power in national content distribution negotiations and increasing demand for scarce sports assets ongoing for premium sports owners for the foreseeable future,” Glagola said. Class A shares are up nearly 10% year to date. —CNBC’s Michael Bloom contributed to this report.