It’s an exciting time for the NBA as interest in basketball continues to grow worldwide and franchises are sold for seemingly ever-growing sums of money. Per Forbes, the average NBA franchise is now valued at $3.85 billion or more than 2x the average of $1.65 billion five years ago.

My take? While costly, NBA investment remains attractive due to the league’s encouraging growth prospects and (most importantly) robust long-term ownership demand. Full thoughts below:

https://open.substack.com/pub/roberteckstein/p/evaluating-investment-in-the-nba-169?r=jd6mt&utm_campaign=post&utm_medium=email

  • BcuzRacecarBEnglish
    1·
    10 months ago

    If you wanted to make a cooler post Id look at the bottom 15 teams in value and then figure out which ones are undervalued because of poor ownership and have great real estate opportunities. Spurs and magic would be the easy first couple.

    • hogback504OPBEnglish
      1·
      10 months ago

      Valuations are pretty consistent across the board when you get outside of the Warrios, Knicks, Lakers (all $6.4B and above). Everyone else is a logical decline in step with market size, and the equal split media revenue share is a BIG equalizer between franchises. A true “rising tide lifts all boats” situation – when it comes down to it, an NBA team is an NBA team.

      Here’s the bottom 15 - nothing surprising or outside the ordinary. Teams with recent sales are slightly overweighted (e.g., Hornets were worth $1.7B before recent sale for $3B) as are teams with recent high profile player acquisitions (Spurs went up $500M just for Wemby):

      Cleveland Cavaliers $3.4B

      Sacramento Kings $3.3B

      Atlanta Hawks $3.3B

      San Antonio Spurs $3.3B

      Milwaukee Bucks $3.2B

      Utah Jazz $3.1B

      Portland Trail Blazers $3.1B

      Detroit Pistons $3.1B

      OKC Thunder $3.1B

      Charlotte Hornets $3.0B

      Orlando Magic $3.0B

      Indiana Pacers $2.9B

      Nola Pelicans $2.6B

      Minnesota T-Wolves $2.5B

      Memphis Grizzlies $2.4B

      • BcuzRacecarBEnglish
        1·
        10 months ago

        Yea they shouldnt be that similar some of those teams have much bigger markets or could grab bigger markets (the jazz just were granted most of the north west tv market, stealing it from the blazers) some of those cities are growing very fast, some of those teams play in crappy arenas and have an opportunity to own their arena (the warriors own chase and make bank because they are now the premier concert venue in the bay area)