Question about Forbes NHL Valuations 2024

[MessierThanThou]

Forbes recently released the valuations of all 32 NHL franchises, and what surprised me most is that the Stanley Cup Champion, Florida, which has had a competitive team for several seasons now, and Carolina, which has also had a competitive team for a while, and a Stanley Cup, are both near the bottom of the league in valuations!

Is there a reason other than these are markets where hockey is unpopular and viewed as a lesser/minor-league attraction, like the CFL in Canada (except Regina)?

The NHL’s Most Valuable Teams 2024

Explore the ranking of hockey's 32 franchises. The Toronto Maple Leafs edge the New York Rangers for No. 1, but every team is worth much more than a year ago.

www.forbes.com

Click to read more...

 

[LPHabsFan]

The teams are not in Top 10 markets, and even then, their ratings, and therefore TV deals, are most likely minimal. They don't make a lot of money, and more often than not, are losing money, unless they make a deep playoff run. Even then, a lot of the "value" of the team also includes revenue gained from owning the arena and non hockey events. Carolina I'm pretty sure doesn't own their arena (the city does I think or some commission) and even then, not sure how many big acts are coming there. Pretty sure Viola has openly stated that he uses the Panthers as a loss leader for his other businesses as well which I'm guessing includes non hockey events.

From a purely financial point of view, they don't really do much for the bottom line of the NHL. Even their valuations have more to do with the general sports teams valuations insanity/bubble that we're in right now rather than the financials of the team.

This is why it's hard to look at these valuations. Every team operates wildly different and we will never know the true financials, even when a team is "sold".

 

[Voight]

The teams are not in Top 10 markets, and even then, their ratings, and therefore TV deals, are most likely minimal. They don't make a lot of money, and more often than not, are losing money, unless they make a deep playoff run. Even then, a lot of the "value" of the team also includes revenue gained from owning the arena and non hockey events. Carolina I'm pretty sure doesn't own their arena (the city does I think or some commission) and even then, not sure how many big acts are coming there. Pretty sure Viola has openly stated that he uses the Panthers as a loss leader for his other businesses as well which I'm guessing includes non hockey events.

From a purely financial point of view, they don't really do much for the bottom line of the NHL. Even their valuations have more to do with the general sports teams valuations insanity/bubble that we're in right now rather than the financials of the team.

This is why it's hard to look at these valuations. Every team operates wildly different and we will never know the true financials, even when a team is "sold".

Exactly. Canes & Panthers have had a lot of success in recent years, but Raleigh & Fort Lauderdale are not Toronto, Boston, Philadelphia etc. Thats just the way it is.

 

[aqib]

The teams are not in Top 10 markets, and even then, their ratings, and therefore TV deals, are most likely minimal. They don't make a lot of money, and more often than not, are losing money, unless they make a deep playoff run. Even then, a lot of the "value" of the team also includes revenue gained from owning the arena and non hockey events. Carolina I'm pretty sure doesn't own their arena (the city does I think or some commission) and even then, not sure how many big acts are coming there. Pretty sure Viola has openly stated that he uses the Panthers as a loss leader for his other businesses as well which I'm guessing includes non hockey events.

From a purely financial point of view, they don't really do much for the bottom line of the NHL. Even their valuations have more to do with the general sports teams valuations insanity/bubble that we're in right now rather than the financials of the team.

This is why it's hard to look at these valuations. Every team operates wildly different and we will never know the true financials, even when a team is "sold".

The first thing to remember is that Forbes applies a formula based on the revenue they estimate the teams get. They can't possibly know all the deals and revenues the team has. Secondly, if you look at how they have valued teams historically and how much they subsequently sold for you see its way off. The Leafs were valued at $2.8 billion last year and now the recent sale puts them at $3.8 billion.
That being said they don't know all the revenues and in many cases the teams are comingled with other properties so its hard to parse out what the NHL team itself is worth. When the NBA and NHL teams are owned by the same owner the arena and sponsorship deals are worth more but how would you how much is attributable to each team. How much would Scotiabank pay if it was just the Leafs?
Things that hurt the Panthers/Hurricanes:
1) Market size
2) Markets full of transplants with loyalties elsewhere
3) No following outside of their market
4) Lack of sponsorship (not many corporate HQs in Ft Lauderdale)
5) Competition from college sports
6) Hockey is not the favorite sport in either market. Sure the Hurricanes are the only pro team in Raleigh-Durham but if you surveyed people in that area I guarantee hockey is behind basketball and football. If you ask people in Edmonton what their favorite sport is, 70+% will say hockey. Sure Raleigh has about the same population as Edmonton but people in Edmonton eat sleep and breath hockey so they spend more on hockey which makes the team worth more.

 

[Yukon Joe]

Forbes recently released the valuations of all 32 NHL franchises, and what surprised me most is that the Stanley Cup Champion, Florida, which has had a competitive team for several seasons now, and Carolina, which has also had a competitive team for a while, and a Stanley Cup, are both near the bottom of the league in valuations!

Is there a reason other than these are markets where hockey is unpopular and viewed as a lesser/minor-league attraction, like the CFL in Canada (except Regina)?

The NHL’s Most Valuable Teams 2024

Explore the ranking of hockey's 32 franchises. The Toronto Maple Leafs edge the New York Rangers for No. 1, but every team is worth much more than a year ago.

www.forbes.com

On ice success is only loosely connected to team valuation.

I mean yes - if you have a lengthy playoff run you can sell more tickets and get more revenue, and revenue is connected to team value. But that's it - and can be fleeting.

So here't ehe list fro Forbes:

Forbes list of the most valuable NHL teams - Wikipedia

en.wikipedia.org

Sort by revenue. You'll see that Florida is 6th from the bottom in revenue, and Carolina is 9th from the bottom. So they don't make all that much money. It's worse when you switch to operating income - Florida is 2nd from the bottom, while Carolina is 8th.

I've heard market size mentioned - frankly that's not much of an explanation for Miami, which is one of the largest metro areas in the US. Very true for Carolina though.

Fundamentally - a franchise is worth what a willing seller and willing buyer is willing to pay. Until/unless the franchises are sold we won't know their current values, and all we (or Forbes) can do is make an educated guess.

 

[MessierThanThou]

On ice success is only loosely connected to team valuation.

I mean yes - if you have a lengthy playoff run you can sell more tickets and get more revenue, and revenue is connected to team value. But that's it - and can be fleeting.

So here't ehe list fro Forbes:

Forbes list of the most valuable NHL teams - Wikipedia

en.wikipedia.org

Sort by revenue. You'll see that Florida is 6th from the bottom in revenue, and Carolina is 9th from the bottom. So they don't make all that much money. It's worse when you switch to operating income - Florida is 2nd from the bottom, while Carolina is 8th.

I've heard market size mentioned - frankly that's not much of an explanation for Miami, which is one of the largest metro areas in the US. Very true for Carolina though.

Fundamentally - a franchise is worth what a willing seller and willing buyer is willing to pay. Until/unless the franchises are sold we won't know their current values, and all we (or Forbes) can do is make an educated guess.

So basically Raleigh is one of the least viable locations that currently has an NHL franchise due to its relative small market and minimal local interest in hockey?