Valuing an MLB Franchise

Our friends over at Bloomberg have a fantastic article up, with a comprehensive analysis and visualization of every team in baseball leading to a team dollar valuation. They examined team value, the regional sports network, merchandising, food, parking, sponsorships, tickets, just about everything under the sun. Unsurprisingly, the Yankees come in first at $3.28 billion, followed by the Dodgers, Red Sox, Mets, and Cubs.

Before we start peeking behind the curtain, let’s have some fun with the numbers. Warning: this will be fun mostly for Yankees fans. Here are the owners who have seen the largest increase in value for their clubs (all dollar values in millions):

Largest Increases in Franchise Value

Team
Purchase Price
Year
Current Valuation
Change in Value
New York Yankees8.7197332803271.3
New York Mets391200220501659
Boston Red Sox700200220601360
San Francisco Giants100199212301130
Philadelphia Phillies30198110401010

Back in 1973, George Steinbrenner paid less than $10 million for the New York Yankees. Since then, they’ve become easily the most valuable franchise in the sport – and one of the most valuable properties in sports – accruing more than $3 billion in value in the forty years that have passed. It’s easier to see precisely how ridiculous this is when the property is looked at from a percent increase in value:

Largest Percent Increases in Franchise Value

Team
Purchase Price
Year
Current Valuation
%Change in Value
New York Yankees8.71973328037601.15%
Chicago White Sox2019819604700.00%
Philadelphia Phillies30198110403366.67%
Minnesota Twins4419847001490.91%
San Francisco Giants100199212301130.00%

The Yankees are 37,000% more valuable than they were in 1973. The world’s total economic output is 370% greater than it was in 1970. That means the Yankees are growing 100 times faster than the world in general. Steinbrenner did pretty well for his $8.7 million. On a yearly basis, the top five looks the same as the above table, except the Giants beat the Twins at an average growth of 53.8% per year against 51.4% for Minnesota. The Yankees once again demolish the field at an average growth rate of 940% per year. Invest a dollar today, get $9.40 back in 365 days. That’s a pretty great return on investment.

How about the teams who aren’t doing so well?

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