Forbes Article: Giants worth $1 billion

[Mays-Fan]

Yanks-Dodgers 1-2 in Forbes poll
Updated: March 26, 2014, 3:14 PM ET
By Darren Rovell | ESPN.com

New York Yankees most valuable at $2.5 billion, Forbes poll says - ESPN New York


The Los Angeles Dodgers might have surpassed the New York Yankees in payroll this year, but the Bronx Bombers still own the title of the league's most valuable team.

Billion Dollar Club

The Yankees again are tops on Forbes' annual list of most valuable MLB franchises. The Dodgers, Red Sox, Cubs and Giants -- all worth at least $1 billion -- round out the top five.
Team Value Titles
Yankees $2.5 billion 27
Dodgers $2 billion 6
Red Sox $1.5 billion 8
Cubs $1.2 billion 2
Giants $1 billion 7

The Yankees are worth $2.5 billion, according to the annual list of franchise values released Wednesday by Forbes.

That makes them the most valuable team in the U.S. sports landscape, topping the value of $2.3 billion Forbes gave to the Dallas Cowboys in August 2013. The Yankees have been the most valuable baseball team for each of the 17 years the magazine has published the list.

The Dodgers, bought two years ago by Guggenheim Partners for $2.15 billion, came in second on Forbes' list at $2 billion. The team has a 25-year television deal with Time Warner Cable worth more than $8 billion, though it lost a battle with Major League Baseball and will have to share more revenue from that deal than it originally projected.

Rounding out the most valuable top five are the Boston Red Sox ($1.5 billion), Chicago Cubs ($1.2 billion) and San Francisco Giants ($1 billion).

Forbes says the average value of an MLB team is $811 million, up 9 percent from last season.

Values, for the most part, have risen year over year, thanks in part to television deals with ESPN, Fox and TBS that begin this year and pay twice as much as the previous deals.

Only three teams fell in value.

The New York Mets, whose attendance has slipped in each of their first five years at Citi Field, fell 1 percent to $800 million. The Miami Marlins are down 4 percent to $500 million, and the Houston Astros fell an astounding 15 percent to $530 million due in part to the implosion of the regional sports network that was broadcasting its games.

 

[Mays-Fan]

One of the takeaways here for me was the validation that TV revenues are a huge driver in the valuation of a franchise (hat tip to Captain Obvious). And while the Yankees lead the list, us being in 5th place tells me there is significant TV revenue for us.

Sign Panda. Up it to 4/60, or even 4/65, put some whipped cream and a cherry on it. See if he bites.

 

[Band of Brothers]

It's good to know that if Dr.Evil wants to destroy the earth that the Giants can pony up the 1 B I L L I O N Dollars to save us all.

Go Giants !!

 

[MarcoPolo]

Listen, don't confuse team value with available revenue. Just because the PROPERTY that is the SF Giants is worth $1B, doesn't mean the team can (or should) spend an extra $30M/yr in salary. Don't confuse "worth" with "cash flow". Say I just lost my job, but I own a $1M home free and clear (no mortgage). Should I say to myself "Hell, I'll just go out and lease that Tesla Model S, since I'm worth over $1M!" ?? Of course not.

When an owner sells out his/her stake, s/he'll make a nice bundle. That doesn't mean that THE TEAM should start spending as if they have $1B coming in every year.

 

[Mays-Fan]

Listen, don't confuse team value with available revenue. Just because the PROPERTY that is the SF Giants is worth $1B, doesn't mean the team can (or should) spend an extra $30M/yr in salary. Don't confuse "worth" with "cash flow". Say I just lost my job, but I own a $1M home free and clear (no mortgage). Should I say to myself "Hell, I'll just go out and lease that Tesla Model S, since I'm worth over $1M!" ?? Of course not.

When an owner sells out his/her stake, s/he'll make a nice bundle. That doesn't mean that THE TEAM should start spending as if they have $1B coming in every year.

Point taken, but in an "ongoing concern", not some jobless SportsHoopla poster, the value is generally considered to be the result, in large part, of a financial model that estimates the revenues and cash flow for X number of years on a pro forma basis, and discounts those flows back to present time using an reasonable discount rate. That's how mergers and acquisitions are done. The value of the Giants is not only the stadium, and other miscellaneous fixed assets. There is positive cash flow here, from attendance-related items and TV revenue, and that is reflected in the estimated value per Forbes. The $1 billion estimate, IMO, clearly indicated that the owners are making some pretty serious scratch from the Giants. Perhaps not as serious as LA or the NYY, but likely enough to make a more lucrative offer to Sandoval.

 

[msgkings322]

Point taken, but in an "ongoing concern", not some jobless SportsHoopla poster, the value is generally considered to be the result, in large part, of a financial model that estimates the revenues and cash flow for X number of years on a pro forma basis, and discounts those flows back to present time using an reasonable discount rate. That's how mergers and acquisitions are done. The value of the Giants is not only the stadium, and other miscellaneous fixed assets. There is positive cash flow here, from attendance-related items and TV revenue, and that is reflected in the estimated value per Forbes. The $1 billion estimate, IMO, clearly indicated that the owners are making some pretty serious scratch from the Giants. Perhaps not as serious as LA or the NYY, but likely enough to make a more lucrative offer to Sandoval.

You ain't kidding...from the same article, in 2013 the Giants had the 3rd biggest operating profit ($53 mil) behind the Cardinals ($65 mil) and Astros ($55 mil, those cheap fucks..). So they can in fact afford to spend a bit of current cash flow to keep up with the Dogs and not become the Padres.

The Dodgers had an $81 mil operating loss last year but they don't care one bit, they know they will sell the team in 20 yrs for 5x what they paid for it, especially if overspending gets them some rings. Also their TV money kicks in this year so the operating #s are about to look a lot better.

The Giants need to realize the same (and they likely do), they will get paid when they sell.