2018 NFL Franchise Valuations, Cowboys and Patriots lead way

By September 20, 2018 No Comments

Forbes released it’s 2018 NFL valuations, and the Cowboys still lead the way at a $5 billion valuation. Jerry Jones and his family enjoy the most valued American sports brand in sports. It’s really not even close. The second highest valued NFL team is the New England Patriots. Their number is set at $3.8 billion. That actually puts the Patriots as tied for third for the most valuable American sports franchise. It’s the Cowboys, the Yankees — at $4 billion — then the Patriots and Knicks valued at $3.8 billion.

That’s the power of the NFL. For all the talk that the NFL is in trouble businesswise, it’s sure not playing out that way. Ratings retreats don’t matter as much when it’s taken in context with other programming. Sure, the NFL isn’t getting the same numbers it was in 2014, but nothing on television is garnering the same viewership it did in the past. It’s a function of the fracturing media landscape and the increase in content. Ratings issues are due to some things that are obvious, but it’s also due to cord cutting and content saturation. The NFL receives most of its revenue from its television deal so TV ratings matter. Advertising matters. Partnership deals and exposure matter and the NFL can offer that up in spades. There’s nothing close to what the league offers across multiple demographics. It’s that simple.

Here’s the only problem for the NFL: more than half of the league did not see their team’s valuation increase. It’s a flat graph. No one in business likes flat. It’s a lot better than down, but the point is for the investment to appreciate. People don’t buy houses and hope that their property has no increase in value. In the end, owners are just like anyone investing something in a house, company, or stock. They want to see their investment increase. It’s a business after all, and the people who own NFL franchises didn’t become rich because the things they invested in stayed the same price. In fact, this is an anomaly. It’s the first time where more than half the NFL — 17 teams didn’t see a year-over-year increase — didn’t see their franchise valuation move up a tick.

If there are any causes for concern that’s it. The NFL is running out of ways to create new revenue and their television deal isn’t going to update until the 2022 season. That also coincides with a potential work stoppage. That’s not great, Bob! The NFL needs to figure out new revenue streams and it needs to figure them out sooner than later. China has been a riddle they simply can’t solve and other leagues are moving into the Asian markets with more success. Gambling will help, but it’s not a panacea. There are opportunities, but the NFL hasn’t shown that it’s ready to take big risks. That makes sense in the “if it ain’t broke, don’t fix it” kind of way. Things may change since 17 owners may see some things as broken due to a zero percent increase in their investment.

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