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According to Forbes, Average Value of MLB Club Rises 7% to $523 Million PDF Print E-mail
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Written by Maury Brown   
Wednesday, 23 March 2011 07:56

Forbes has announced its annual valuations of Major League Baseball’s 30 teams, reporting that the average team is now worth $523 million, a 7% increase from last year and an all-time high.  New ballparks and regional sports networks boosted revenues 4 percent to $6.1 billion for baseball's 30 teams.  The New York Yankees are on top again this year with a value of $1.7 billion. Coming in at No. 2, the Boston Red Sox are valued at $912 million. The New York Mets are valued at $747 million, down 13 percent from last year’s valuation.

In Inside Baseball’s Debt Disaster (p. 100), Forbes reports on how reckless ownership and lax debt policies within Major League Baseball has allowed popular teams like the Texas Rangers, Los Angeles Dodgers and most recently, the New York Mets to amass mountains of debt.  In investigating the Mets’ involvement with Bernie Madoff and the team’s subsequent debt problems, Forbes concludes that it will be challenge for Fred Wilpon and Saul Katz to retain majority ownership.

To many, the most surprising will be the Los Angeles Dodgers, who have been rocked by the divorce between Frank and Jamie McCourt, and its growing debt show an increase in value of 10 percent from last year seeing its value increase to $800 million for the first time, up from $727 million last year.

According to co-author Mike Ozanian, the reason for the increase in the Dodgers speaks to the robustness of MLB.

"We increased the multiple of revenue we valued the team to 3.25 from 2.95 last year because baseball team multiples overall are up (better economy and financing environment) and the Dodgers brand (as measured by revenue and ebitda) is as strong as ever" said Ozanian. "So, another way to look at it is our enterprise value for the team rose because debt increased and equity did not decrease.

The Giants, who are reaping the benefits of winning last year’s World Series see an increase of 18 percent, and Operating Income, a form of profit as $29.9 million. The Texas Rangers, who moved from being saddled with debt under Tom Hicks to new ownership through an auction sale last year, and a new TV deal, see a massive jump in value from ranking 12 with a value of $451 million last year to $561 million this year. Note that Forbes lists Ray Davis and Bob Simpson as owners, not Nolan Ryan or recently ousted managing partner Chuck Greenberg.

This initial article shows information released in advance of Forbes releasing all 30 valuations to the public. Those numbers are now available with more information on Forbes.com/sportsmoney

OUR ANNUAL REPORT ON ALL 30 CLUBS WILL BE FORTHCOMING ON THURS.

(See historical Forbes valuations from 2002-2010 - Will be updated with 2011 shortly)

This year’s Top 10 Most Valuable Major League Baseball Teams are:

RANK

TEAM

OWNER

CURRENT VALUE

($ mil)

1-YR CHANGE
IN VALUE %

REVENUES

($mil)

OPERATING

INCOME ($mil)

1

New York Yankees

Steinbrenner Family

$1,700

6%

$427

$25.7

2

Boston Red Sox

John Henry, Thomas Werner

912

5

272

-1.1

3

Los Angeles Dodgers

Frank McCourt

800

10

246

32.8

4

Chicago Cubs

Ricketts Family

773

6

258

23.4

5

New York Mets

Fred Wilpon, Saul Katz

747

-13

233

-6.2

6

Philadelphia Phillies

David Montgomery

609

13

239

8.9

7

San Francisco Giants

William Neukom

563

16

230

29.9

8

Texas Rangers

Ray Davis, Bob Simpson

561

25

206

22.6

9

LA Angels of Anaheim

Arturo Moreno

554

6

222

11.8

10

Chicago White Sox

Jerry Reinsdorf

526

13

210

27.6

LEAGUE AVERAGE

523

7

205

16.5

 

Source: Forbes


SPECIAL BUSINESS OF SPORTS NETWORK REPORTS:
The Labor Battle in the NFL. See BizOfFootball.com for details

 

 

 


Maury BrownMaury Brown is the Founder and President of the Business of Sports Network, which includes The Biz of Baseball, The Biz of Football, The Biz of Basketball and The Biz of Hockey, as well as a contributor to FanGraphs and Forbes SportsMoney. He is available for hire or freelance. Brown's full bio is here. He looks forward to your comments via email and can be contacted through the Business of Sports Network.

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