A quick note on value...

Mar 24, 2023 - 6:30 PM

Yesterday, Forbes released their annual report on team values and the San Francisco Giants were there in the top five in terms of profitability with $74.9 million and total value at $3.7 billion. That represents a year over year increase of 6%. I’m not going to be able to add much to the discussion that wasn’t already covered by people online and in the comments yesterday, but let’s discuss it here anyway for posterity!

One of the earlier posts I can recall during my brief time as this site’s managing editor was the 2018 valuation piece, and in that one, Forbes reported that the team had increased in value from 2016-2017. You’ll recall that the Giants followed up their 2016 playoff season with one of their worst seasons ever. The 2022 Giants, of course, were a staggering disappointment coming of an historically successful 2021.

The Giants have basically been a top five franchise for nearly a decade now, with their championship run of success helping to balloon the valuation. And I imagine Forbes’ formula values the team differently than, say, real world investors, because as the article indicates:

Ownership stakes in regional sports networks, as well as related profits or losses, are excluded from our valuations and operating results, as are investments in real estate and other businesses.

Well, the Giants have a substantial stake in Mission Rock as well as NBC Sports Bay Area and KNBR. The team might only average 64,000 households in TV viewing (which is right around 10th-best in the sport), but 71% (or $2.62 billion) of the team’s value comes from its media market and the stadium just in Forbes’ formula, so you can imagine just how much more money is involved once the land scheme gets factored in — again, for outside investors (as Jarret Seidler noted yesterday, there’s such a thing as “unrealized capital gains” which goes to value).

Here’s a look at the Giants’ value over the last decade:

Great! Wonderful! Fantastic — for the investors! Although, as we see with the Giants’ $70 million Arizona complex: they’re willing to spend the money on baseball operations to invest long-term. Will this year’s $200+ million payroll wind up paying dividends on the field? That remains to be seen. There’s certainly a better chance that it simply winds up eating into profit forecasts and little else, but as we can clearly see here, at least in terms of what’s publicly available data, no matter how the team performs on the field or even in the face of a pandemic shutdown year, the San Francisco Giants continue to increase in value.