Thursday, March 27, 2014

MLB: Forbes' team value rankings provide interesting takeways

For 17 years, Forbes has presented a fantastic listing of franchise valuations and earnings results for all 30 Major League Baseball teams. For each of those years, the New York Yankees have topped the list as the league’s most valuable franchise.

The Yankees came in at $2.5 billion this year, $500 million ahead of the second-ranked club, the Los Angeles Dodgers.

Forbes’ valuations “are enterprise values (debt plus equity) and include completed television deals that begin in the future, but exclude the equity interests in other assets the team may own, such as regional sports networks or concession businesses. Revenues and operating income figures include all revenue and expenses for each team and its stadium where applicable.”

There are several takeaways beyond the values of the teams which I found interesting.

  • Three teams saw their value increase by at least 20 percent – the San Francisco Giants (27%), the Dodgers (24%) and the Chicago Cubs (20%)
  • Each of those three teams are also said to be worth at least $1 billion
  • Despite a value change downward of 15 percent, the Houston Astros managed the second-highest operating income ($55.9 million)
  • The Astros lost 111 games in 2013
  • Only the Boston Red Sox, St. Louis Cardinals, Cubs and the Giants ranked in the top 10 in each of the following categories – value, value change, revenue, operating income
  • The Red Sox and the Cardinals met in the 2013 World Series
  • The Cubs continue to enjoy high rankings despite five straight losing seasons
  • Further the Cardinals (23%) and Giants (16.9%) were ranked #2 and #3 in operating margin (percentage of operating income in relation to revenue)
  • The highest operating margin was produced by the Astros (30.1%) and lowest by the Dodgers (-27.6%)
  • The New York Mets (-1%), the Miami Marlins (-4%) and Astros (-15%) were the only teams which registered a decrease in value
  • Those teams had a combined 191-295 record in 2013
  • The Yankees revenue was 29.1 percent larger than the next team in line, the Red Sox
  • The Yankees revenue was at least double that of 17 other teams
  • 11 teams failed to generate positive operating income
  • 11 teams showed operating income of at least $20 million
As cable deals continue to evolve for teams and baseball is able to maintain attendance growth across the game (on average), these numbers will continue to rise for a majority of the teams.

Christopher Carelli is a freelance sports writer/editor and the Director of Content Strategy for Sportsideo.