Each season, Forbes magazine publishes an article detailing the financial state of major-league baseball teams. This year's article was released today and so you don't have to give Forbes 30 clicks to see every team's numbers, I'm here to distill down the information for you, particularly as it pertains to the Cubs.
The Cubs rank fifth in the team valuation list at $1.8 billion, behind the Yankees, Dodgers, Red Sox and Giants. They're one spot lower in the annual-revenue chart at $302 million -- the Angels are ahead of them, along with the four teams earlier mentioned.
But it's in operating income where the Cubs jump very close to the top of the list. They're shown at $73.3 million in operating income (the article doesn't specifically say what year that's from, but I'm assuming it's 2014). That's second only to the Cardinals at $73.6 million.
If you're interested, at the bottom of the value ranking are the Tampa Bay Rays at $625 million; the Phillies are at the bottom in operating income with a listing of a loss of $39 million.
Here's what the article says about the Cubs and what they are currently doing:
In 2009, the Ricketts family paid $845 million for the Cubs, Wrigley Field, 25% of Comcast SportsNet Chicago and some nearby real estate. The deal valued the Cubs at three times revenue. In February, the family sold small pieces of these assets for an enterprise value of $2.25 billion. The value placed on the Cubs alone was $1.8 billion—six times revenue–the highest-valuation ever created by the purchase of a non-controlling interest in a sports team. Like the Cardinals and Giants, the Cubs are also developing the land near their stadium as a destination place.
My understanding is that the ownership interest in CSN Chicago is actually 20 percent, not 25 (20 percent each for the four teams involved and 20 percent for NBC Universal). Here's how Forbes explains its methodology:
Our team values are enterprise values (equity plus net debt) based on the revenue multiples of past transactions. We make adjustments for teams getting new ballparks, like the Atlanta Braves. The enterprise values exclude equity teams have in non-baseball assets, such as real estate, regional sports networks or stadium businesses. The revenue figures we show for each team include all money the teams get, including tickets and premium seating, media, concessions and merchandise, licensing and other distributions from MLB’s central fund, as well as non-baseball stadium events like concerts and soccer games. Revenue are net of annual stadium debt service for which the team is responsible, as well as money teams receive, or pay, as part of the league’s local revenue-sharing system. Luxury payroll tax figures paid to MLB are subtracted from the team’s operating income.
Anyway, I thought you'd all like to have a look at this and discuss while we wait for tonight's game.