While National Football League team revenues soar, market value follows. And the sale of a team becomes a massive financial event.
The Washington Commanders National Football League (NFL) team may be up for sale, in whole or in part.
It was revealed Nov. 2 in a statement from owners Dan and Tanya Snyder that they have hired Bank of America Securities to consider potential transactions, including the potential sale of the franchise.
When calculating the market value of an NFL team, a number of factors come in to play. The most important, of course, is an understanding of the current financial landscape.
First, it’s important to look at the value that was placed on a team sold in the recent past. Simply put, one would examine the assets and value of a given team currently for sale compared with those of the recently purchased team and adjust the value of the franchise appropriately.
The Current Value of NFL Teams
Sportico, a Website that focuses on the business of sports, published such an analysis on August 1, immediately following the sale of the Denver Broncos. In July, an ownership group led by Rob Walton–the son of Walmart founder Sam Walton–had purchased the Broncos from the Pat Bowlen Trust for $4.65 billion.
The valuation of an NFL team is defined by “the sum of the fair-market value of an NFL franchise combined with the value of team-related businesses and real estate holdings,” Sportico says.
In its 2022 NFL Franchise Valuations Ranking, Sportico ranks the Broncos tenth out of the league’s 32 teams. The Broncos’ value comes in at exactly $4.65 billion, the exact amount for which the team sold. This follows the plain principle that in the current moment, the team’s market value is simply the amount it just sold for.
The number one team in Sportico’s evaluation is the Dallas Cowboys, estimated to be worth $7.64 billion. Numbers two and three are the Los Angeles Rams and the New England Patriots, at $5.91 and $5.88 billion respectively.
The team with the lowest estimated current value, according to Sportico, is the Cincinnati Bengals at $2.84 billion.
The Washington Commanders come in at number eight with an estimated valuation of $4.78 billion. But of course, the real value of the team, should it be sold in its entirety at some point in the near future, is frankly whatever it ends up selling for.
Image source: Shutterstock
A Few Current Thoughts on a Potential Sale
Dan and Tanya Snyder made clear that stability in the franchise is important to them, no matter what happens from here.
“The Snyders remain committed to the team, all of its employees and its countless fans to putting the best product on the field and continuing the work to set the gold standard for workplaces in the NFL,” their statement said.
When asked by NFL Network’s Ian Rapaport if the Snyders are considering a sale of all are just part of team, a Commanders spokesperson told him “we are exploring all options,” according to NFL.com.
As far as the process ahead, the NFL clarified, in part, the final step to approving any deal.
“Any potential transaction would have to be presented to the NFL Finance Committee for review and require an affirmative vote by three quarters of the full membership (24 of 32 teams),” league spokesperson Brian McCarthy said in a statement on Wednesday.