Pittsburgh Penguins: What Is An NHL Team Worth?

By Larry Snyder

According to Mike Ozanian and the staff at Forbes, the Pittsburgh Penguins this year fall just outside of the Top 10 of the Most Valuable Franchises in the National Hockey League.

Ozanian states that Pittsburgh’s revenue from the 2014-15 season was $151 million and that the Black and Gold’s operating income last season was $20.2 million. Over the summer, we know that Mario Lemieux and Ron Burkle brought in the financial services firm Morgan Stanley to go over selling options.

The Forbes crew believes what is holding up any transaction is the $750 million asking price which includes the land development rights at the former Mellon Arena site. One group of experts consider the cost exorbitant given the front-loading of the Penguins’ local television revenue.

Over the course of last season, 80% of the NHL’s proceeds came from local and non-shared streams like ticket sales, luxury seating arrangements, advertising, and television. The league is in a place that the regular season remains a break-even premise. The worth of teams are found in the Stanley Cup playoffs and cable television pacts.

The other three team sports, the National Football League, Major League Baseball, and the National Basketball Association, claim large national media and sponsorship contracts that provides insulation from losing records and disgruntled fans who stop showing up for contests.

Two factors at work contributing to the value of NHL teams are: a) being in the second year of the collective bargaining agreement and b)the league’s new Canadian television deal with Rogers Communications. The NHL has three teams that are worth at least one billion dollars in the New York Rangers at $1.1 billion, the Montreal Canadiens at $1.175 billion, and the Toronto Maple Leafs at $1.15 billion.

On a side note, Kurt Badenhausen at Forbes has Sidney Crosby at No. 1 with $16.5 million and Evgeni Malkin at No. 7 with $9.85 million on his Top 10 list of highest paid NHL players. The Forbes formula takes into account salaries, endorsements, licensing memorabilia and appearances. In comparison to NBA players, Badenhausen’s Top 10 list has the Clippers’ Blake Griffin at No. 10 with earnings of $24.7 million.

When reviewing the NHL list keep in mind the average worth of a National Football League franchise is $2 billion, the average for a Major League Baseball team is $1.2 billion, and the average value of a National Basketball Association squad is $1.1 billion.

In September, Forbes lists the Steelers at No. 13 among NFL teams with a value of $1.9 billion, while, in March, Forbes rated the Pirates at No. 19 among MLB squads at $900 million.

Forbes NHL Top 10:

1) New York Rangers $1.2 Billion
2) Montreal Canadiens $1.175 B
3) Toronto Maple Leafs $1.15 B
4) Chicago Blackhawks $925 Million
5) Boston Bruins $750 M
6) Vancouver Canucks $745 M
7) Philadelphia Flyers $660 M
8) Detroit Red Wings $600 M
9) Los Angeles Kings $580 M
10) Washington Capitals $565 M

Forbes NHL Middle 10:

11) Pittsburgh Penguins $560 M
12) Edmonton Oilers $455 M
13) Dallas Stars $450 M
14) San Jose Sharks $445 M
15) Calgary Flames $435 M
16) Anaheim Ducks $400 M
17) Minnesota Wild $380 M
18) Ottawa Senators $370 M
19) Colorado Avalanche $360 M
20) Winnipeg Jets $350 M

Forbes NHL Bottom 10:

21) New Jersey Devils $330 M
22) New York Islanders $325 M
23) Buffalo Sabres $300 M
24) St Louis Blues $270 M
25) Tampa Bay Lightning $260 M
26) Nashville Predators $255 M
27) Columbus Blue Jackets $226 M
28) Carolina Hurricanes $225 M
29) Arizona Coyotes $220 M
30) Florida Panthers $186 M

Perhaps it would be cheaper for Las Vegas or Quebec City to purchase the Florida Panthers and move the team instead of paying expansion fees. Could we see moving trucks heading to Miami soon?

Somebody cue up the O’Jays and Pink Floyd…