Annual Forbes valuations: Celtics are making bank

[Roy H.]

1.  Golden State Warriors - $7 billion valuation - $206 million operating income (profit)
2.  New York Knicks - $6.1 billion valuation - $155 million operating income (profit)
3. Los Angeles Lakers - $5.9 billion valuation - $115 million operating income (profit)
4. Chicago Bulls - $4.1 billion valuation - $135 million operating income (profit)
5.  Boston Celtics - $4.0 billion - $137 million operating income (profit)

The Celtics are worth 13% more than last year.  They have appreciated by $3.64 billion since 2002.  Last year was the Celtics' most profitable year in team history, by a substantial margin.

They ranked 5th in valuation; 4th in operating income; and 7th in revenue.

Interestingly, Forbes now has the Celtics calculated as being more valuable than the Red Sox ($3.9 billion, calculated in March 2022).  They're well ahead of the Bruins ($1.3 billion), but far behind the Patriots ($6.4 billion).

[Roy H.]

And a cheapness index:



https://twitter.com/StephNoh/status/1585692234347073536

[Donoghus]

Interestingly, Forbes now has the Celtics calculated as being more valuable than the Red Sox ($3.9 billion, calculated in March 2022).  They're well ahead of the Bruins ($1.3 billion), but far behind the Patriots ($6.4 billion).

So we should be expecting Celtics hit pieces from the Globe coming soon?

[Ed Monix]

Interestingly, Forbes now has the Celtics calculated as being more valuable than the Red Sox ($3.9 billion, calculated in March 2022).  They're well ahead of the Bruins ($1.3 billion), but far behind the Patriots ($6.4 billion).

So we should be expecting Celtics hit pieces from the Globe coming soon?

Red Sox Most Valueable Franchise On Earth

Forbes Spreading Fake News?

[footey]

1.  Golden State Warriors - $7 billion valuation - $206 million operating income (profit)
2.  New York Knicks - $6.1 billion valuation - $155 million operating income (profit)
3. Los Angeles Lakers - $5.9 billion valuation - $115 million operating income (profit)
4. Chicago Bulls - $4.1 billion valuation - $135 million operating income (profit)
5.  Boston Celtics - $4.0 billion - $137 million operating income (profit)

The Celtics are worth 13% more than last year.  They have appreciated by $3.64 billion since 2002.  Last year was the Celtics' most profitable year in team history, by a substantial margin.

They ranked 5th in valuation; 4th in operating income; and 7th in revenue.

Interestingly, Forbes now has the Celtics calculated as being more valuable than the Red Sox ($3.9 billion, calculated in March 2022).  They're well ahead of the Bruins ($1.3 billion), but far behind the Patriots ($6.4 billion).

Those operating incomes are misleading, aren't they pre-luxury tax? What is GS' annual luxury tax in 2022, something like $175 million, right?

[Roy H.]

1.  Golden State Warriors - $7 billion valuation - $206 million operating income (profit)
2.  New York Knicks - $6.1 billion valuation - $155 million operating income (profit)
3. Los Angeles Lakers - $5.9 billion valuation - $115 million operating income (profit)
4. Chicago Bulls - $4.1 billion valuation - $135 million operating income (profit)
5.  Boston Celtics - $4.0 billion - $137 million operating income (profit)

The Celtics are worth 13% more than last year.  They have appreciated by $3.64 billion since 2002.  Last year was the Celtics' most profitable year in team history, by a substantial margin.

They ranked 5th in valuation; 4th in operating income; and 7th in revenue.

Interestingly, Forbes now has the Celtics calculated as being more valuable than the Red Sox ($3.9 billion, calculated in March 2022).  They're well ahead of the Bruins ($1.3 billion), but far behind the Patriots ($6.4 billion).

Those operating incomes are misleading, aren't they pre-luxury tax? What is GS' annual luxury tax in 2022, something like $175 million, right?

I’m pretty sure they’re post-tax.  The Warriors just bring in a ridiculous amount of revenue, around $765 million last season.

[knuckleballer]

There’s a lot of discussion about affording both Grant and Al.  People are projecting that they will make about $30 million combined.  Considering the Celtics have an operating income of $137 million in a year still dealing with COVID, I would think affording both players would be easy.

So, I thought I’d bump this thread since it seams relevant. 

Some, including myself, would love like to add another significant big such as Poeltl.  Even if we have to spend an additional $15-20 mill for him starting next year, I would think the team could still afford it even with the luxury tax.  Look at GS’s payroll.  If we start contending for championships and win one, the revenue and valuation of the team is going to rise.

Wyc and company paid $360 million for this team which is now valued at $4 billion.  I’d be really disappointed if being cheap holds them back from winning number 18 and hopefully more.  Spend, Wyc, spend.

[Moranis]

I heard someone, I think it was Windhorst, recently talking about revenue in the NBA.  He had seen the actual books and he stated that Lakers per week got more television revenue than several teams got over the course of the entire season.  I'm sure the Warriors, Knicks, etc. are much closer to the Lakers in that department than other teams.  That is where the real discrepancy is in the revenue generation. 

[sgrogan]

I heard someone, I think it was Windhorst, recently talking about revenue in the NBA.  He had seen the actual books and he stated that Lakers per week got more television revenue than several teams got over the course of the entire season.  I'm sure the Warriors, Knicks, etc. are much closer to the Lakers in that department than other teams.  That is where the real discrepancy is in the revenue generation.

I'm sure your right. That's part of the valuation.
I'm sure the Celtic's are closer to to the Warriors than the Thunder.

[Surferdad]

There’s a lot of discussion about affording both Grant and Al.  People are projecting that they will make about $30 million combined.  Considering the Celtics have an operating income of $137 million in a year still dealing with COVID, I would think affording both players would be easy.

So, I thought I’d bump this thread since it seams relevant. 

Some, including myself, would love like to add another significant big such as Poeltl.  Even if we have to spend an additional $15-20 mill for him starting next year, I would think the team could still afford it even with the luxury tax.  Look at GS’s payroll.  If we start contending for championships and win one, the revenue and valuation of the team is going to rise.

Wyc and company paid $360 million for this team which is now valued at $4 billion.  I’d be really disappointed if being cheap holds them back from winning number 18 and hopefully more.  Spend, Wyc, spend.

Not as sure about that. Operating income is no way equivalent to net profit. Player salaries are just one expense among many. Just think about running the Auerbach Center, a place which presumably has no revenues. Is Wyc & Co even turning a profit? I don't know.

[Roy H.]

There’s a lot of discussion about affording both Grant and Al.  People are projecting that they will make about $30 million combined.  Considering the Celtics have an operating income of $137 million in a year still dealing with COVID, I would think affording both players would be easy.

So, I thought I’d bump this thread since it seams relevant. 

Some, including myself, would love like to add another significant big such as Poeltl.  Even if we have to spend an additional $15-20 mill for him starting next year, I would think the team could still afford it even with the luxury tax.  Look at GS’s payroll.  If we start contending for championships and win one, the revenue and valuation of the team is going to rise.

Wyc and company paid $360 million for this team which is now valued at $4 billion.  I’d be really disappointed if being cheap holds them back from winning number 18 and hopefully more.  Spend, Wyc, spend.

Not as sure about that. Operating income is no way equivalent to net profit. Player salaries are just one expense among many. Just think about running the Auerbach Center, a place which presumably has no revenues. Is Wyc & Co even turning a profit? I don't know.

Is there reason to expect that Forbes doesn't account for those expenses in its estimates?

Player expenses are listed at $137 million.  Total revenue was $361 million.  Operating income is $137 million.    That means there are at least $87 million in organizational expenses that don't involve player salary.

If these guys aren't turning profits, why are franchise valuations through the roof, increasing year by year?  The Celts were "only" worth $875 million in 2014.  Eight years later, they're at $4 billion. 

[Surferdad]

There’s a lot of discussion about affording both Grant and Al.  People are projecting that they will make about $30 million combined.  Considering the Celtics have an operating income of $137 million in a year still dealing with COVID, I would think affording both players would be easy.

So, I thought I’d bump this thread since it seams relevant. 

Some, including myself, would love like to add another significant big such as Poeltl.  Even if we have to spend an additional $15-20 mill for him starting next year, I would think the team could still afford it even with the luxury tax.  Look at GS’s payroll.  If we start contending for championships and win one, the revenue and valuation of the team is going to rise.

Wyc and company paid $360 million for this team which is now valued at $4 billion.  I’d be really disappointed if being cheap holds them back from winning number 18 and hopefully more.  Spend, Wyc, spend.

Not as sure about that. Operating income is no way equivalent to net profit. Player salaries are just one expense among many. Just think about running the Auerbach Center, a place which presumably has no revenues. Is Wyc & Co even turning a profit? I don't know.

Is there reason to expect that Forbes doesn't account for those expenses in its estimates?

Player expenses are listed at $137 million.  Total revenue was $361 million.  Operating income is $137 million.    That means there are at least $87 million in organizational expenses that don't involve player salary.

If these guys aren't turning profits, why are franchise valuations through the roof, increasing year by year?  The Celts were "only" worth $875 million in 2014.  Eight years later, they're at $4 billion.

Don't ask me. I know next to nothing about running a business or finance in general. That said...

Regardless of valuations, we don't know if this is a profitable business. The $4b valuation can be used to borrow money and keep the business running.  Cash flow is the key, not necessarily profit.

[Vermont Green]

I don't get the fascination with paying the tax.  If you look at the top 5 tax paying teams:

GSW
BKN
NYK
CLE
LAL

How many of those franchises would you rather be?  If you want to compare to GSW, they are at the end of their run anchored by Curry and Thompson (with a Durant visit mixed in there).  We are at the beginning of our run with Tatum and Brown (hopefully).  And is the CLE number right?  It doesn't look right.  Spotrac shows them at about $2.5M under the tax line this season.  Are these the tax payments over some period of time?  LAL, BKN, NYK are all high paying failures, as is often the case for teams that spend recklessly.

I am not disappointed with the Celtics spending overall.  They have paid to keep Tatum, Brown, Smart, RWill.  They brought in money with Horford and Brogdon trades, White too.  Now Grant is up.  And Horford.  Are people still hung up on them not trading for Nerlens Noel with the TPE?  Really, the Celtics have bad or cheap ownership because they didn't trade for a guy that has played 4 games and has a total of 11 pts and 15 rebs?

Part of sports fandom is second guessing trades and signings and all of that.  Missed draft picks (Giannis), or bad draft picks (Fab Melo).  But overall, taken in aggregate, I find it very had to be critical of the way ownership has run this team, including spending.  A MLB team that spends $30M and lives off the revenue sharing deserves criticism.  An organization that has the best current team, was in the finals last season, is build responsibly around young stars, isn't really the same thing at all.

[Roy H.]

I don't get the fascination with paying the tax.  If you look at the top 5 tax paying teams:

GSW
BKN
NYK
CLE
LAL

How many of those franchises would you rather be? 

Obviously the Warriors, right? 

But, for more perspective, this is how much the various teams have spent in tax since 2001, not including last season:

1) Golden State Warriors: $337,841,573 (4 titles)

2) Brooklyn/New Jersey Nets: $297,855,872

3) New York Knicks: $248,542,987

4) Cleveland Cavaliers: $179,622,897 (1 title)

5) L.A. Lakers: $171,795,994 (5 titles)

6) Dallas Mavericks: $150,530,433 (1 title)

7) L.A. Clippers: $117,898,859

8 ) Portland Trail Blazers: $109,148,302

9) Oklahoma City Thunder/Seattle Supersonics: $106,443,551

10) Milwaukee Bucks: $57,565,881  (1 title)

11) Miami Heat: $52,903,034 (3 titles)

12) Boston Celtics: $50,632,705 (1 title)

The only title-winning franchises that have spent less tax than us are the Raptors, Spurs and Pistons (who last contended when the tax was a lot smaller).  Spending doesn't guarantee titles.  However, not spending seemingly makes it harder to win.

[Surferdad]

Interesting article about a year ago on Celticsblog:
https://www.celticsblog.com/2021/9/19/22650143/its-your-money-breaking-down-myth-of-nba-ownership-and-who-really-foots-the-bill-boston-celtics
Just one snippet on expenses:

According to SI, 58% of the average small market team’s expenses went toward player salaries, while major market teams paid roughly 52%.