Moderators: HomoSapien, Ice Man, dougthonus, Tommy Udo 6 , DASMACKDOWN, GimmeDat, Payt10, RedBulls23, coldfish, fleet, AshyLarrysDiaper, kulaz3000, Michael Jackson
Leslie Forman wrote:Assuming absolutely nothing changes with ownership, I would not be surprised if, in 10 years, both NY and both LA teams were ahead of the Bulls on these valuation lists.
Leslie Forman wrote:Assuming absolutely nothing changes with ownership, I would not be surprised if, in 10 years, both NY and both LA teams were ahead of the Bulls on these valuation lists.
Michael Jackson wrote:Leslie Forman wrote:Assuming absolutely nothing changes with ownership, I would not be surprised if, in 10 years, both NY and both LA teams were ahead of the Bulls on these valuation lists.
Realistically though they should be. I would assume Brooklyn and Clipps are both going to eat up market share in their respective markets the next few years plus they will get more national and global attention. Nothing shocking with that prediction. Chicago is also receding people daily. I’d be shocked if those two didn’t. Now if Atlanta over takes Chicago that is more interesting to me. They have the population to do it but I don’t know that the hawks have the hold that the Bulls do.
Michael Jackson wrote:Leslie Forman wrote:Assuming absolutely nothing changes with ownership, I would not be surprised if, in 10 years, both NY and both LA teams were ahead of the Bulls on these valuation lists.
Realistically though they should be. I would assume Brooklyn and Clipps are both going to eat up market share in their respective markets the next few years plus they will get more national and global attention. Nothing shocking with that prediction. Chicago is also receding people daily. I’d be shocked if those two didn’t. Now if Atlanta over takes Chicago that is more interesting to me. They have the population to do it but I don’t know that the hawks have the hold that the Bulls do.
dougthonus wrote:musiqsoulchild wrote:I know what you're talking about Doug. But theres no dividend payout here. Theres no Bulls stock that appreciates in value.
So? People who have billions of dollars can wait for the final sale. Not everyone needs cash. In fact, most people rich enough to own an NBA team don't need cash.I am fairly certain that we are using the profit model to pay off the Advocate Center. Thats what the company I work for did. They financed an acquisition and until the debt for that financing was paid off, we were ultra-profit prioritizing our decisions.
Sure, it doesn't mean those are the only viable models though.
Leslie Forman wrote:Michael Jackson wrote:Leslie Forman wrote:Assuming absolutely nothing changes with ownership, I would not be surprised if, in 10 years, both NY and both LA teams were ahead of the Bulls on these valuation lists.
Realistically though they should be. I would assume Brooklyn and Clipps are both going to eat up market share in their respective markets the next few years plus they will get more national and global attention. Nothing shocking with that prediction. Chicago is also receding people daily. I’d be shocked if those two didn’t. Now if Atlanta over takes Chicago that is more interesting to me. They have the population to do it but I don’t know that the hawks have the hold that the Bulls do.
They really shouldn't, just like how the Mets and Angels are not bigger than the Cubs, or the Islanders and Ducks are not bigger than the Hawks.
Being the only franchise, and one with an internationally, culturally iconic brand in the easily third biggest, richest market of the country should be at least an automatic #3 valuation ranking every single year for eternity. It would take an immense lack of give-a-sh*tness to take a brand like this in a market like this, which is actually much more of a basketball town than even the people of this city think, IMO, to fall behind second-tier NY/LA teams, or the Celtics, or the Rockets, or whatever. It'd be a downright Wirtz-ian lack of leadership to let that happen.
I can assure you, however, that the Atlanta Hawks will not be one of those teams that overtakes them. Nobody gives a flying F about the Hawks there. They make less revenue than the Magic.
Leslie Forman wrote:Michael Jackson wrote:Leslie Forman wrote:Assuming absolutely nothing changes with ownership, I would not be surprised if, in 10 years, both NY and both LA teams were ahead of the Bulls on these valuation lists.
Realistically though they should be. I would assume Brooklyn and Clipps are both going to eat up market share in their respective markets the next few years plus they will get more national and global attention. Nothing shocking with that prediction. Chicago is also receding people daily. I’d be shocked if those two didn’t. Now if Atlanta over takes Chicago that is more interesting to me. They have the population to do it but I don’t know that the hawks have the hold that the Bulls do.
They really shouldn't, just like how the Mets and Angels are not bigger than the Cubs, or the Islanders and Ducks are not bigger than the Hawks.
Being the only franchise, and one with an internationally, culturally iconic brand in the easily third biggest, richest market of the country should be at least an automatic #3 valuation ranking every single year for eternity. It would take an immense lack of give-a-sh*tness to take a brand like this in a market like this, which is actually much more of a basketball town than even the people of this city think, IMO, to fall behind second-tier NY/LA teams, or the Celtics, or the Rockets, or whatever. It'd be a downright Wirtz-ian lack of leadership to let that happen.
I can assure you, however, that the Atlanta Hawks will not be one of those teams that overtakes them. Nobody gives a flying F about the Hawks there. They make less revenue than the Magic.
johnnyvann840 wrote:dougthonus wrote:musiqsoulchild wrote:I know what you're talking about Doug. But theres no dividend payout here. Theres no Bulls stock that appreciates in value.
So? People who have billions of dollars can wait for the final sale. Not everyone needs cash. In fact, most people rich enough to own an NBA team don't need cash.I am fairly certain that we are using the profit model to pay off the Advocate Center. Thats what the company I work for did. They financed an acquisition and until the debt for that financing was paid off, we were ultra-profit prioritizing our decisions.
Sure, it doesn't mean those are the only viable models though.
Great points Doug.
Musiq, here's the bottom line (no pun intended). Let's just say you are a minority owner of the Chicago Bulls. Likely, one of JR's cronies who's been around from the beginning. Bought in for $250K back in 1985, giving you a 2% ownership interest in the franchise. Today, that 2% is worth $60 MILLION DOLLARS. Believe me if you wanted to sell your 2% of the Bulls to somebody for $60 million there would be investors lining up to buy that share, or say you just wanted to get a quick $30 million by selling half of your interest. It would not be hard... in fact JR or any of the other owners would gladly take it off your hands. So, cashing out would be easy. This is why the value of the team is much more important than the difference between net income of $98M for the year vs. $114M.
The value of the franchise is the real PRIZE and the bulk of the real money. Also, putting a better product on the floor (which can be made possible by spending a little more in team salary, if spent wisely, of course) is going to increase merchandise sales, possibly earn the ownership group playoff revenue, and increase fan interest, which is all much more important than reducing operation cost on that side of the balance sheet by ten or twenty million on a season. It's nothing in comparison. Sure, we could find some bean counter who doesn't understand the dynamics of it all and would tell you how equity can't pay the bills, but that just isn't a realistic way of looking at things in this environment. I'm not saying to go out and just piss away money for the hell of it. I'm saying don't handcuff yourself by restricting costs too much.
You think the minority owner cares more about making an extra $300K last year or making a return on his $250,000 investment of $60,000,000? The operation costs are almost negligible in real terms. Meaningless when we are talking about 2% of $10M or something to that effect.
musiqsoulchild wrote:johnnyvann840 wrote:dougthonus wrote:
So? People who have billions of dollars can wait for the final sale. Not everyone needs cash. In fact, most people rich enough to own an NBA team don't need cash.
Sure, it doesn't mean those are the only viable models though.
Great points Doug.
Musiq, here's the bottom line (no pun intended). Let's just say you are a minority owner of the Chicago Bulls. Likely, one of JR's cronies who's been around from the beginning. Bought in for $250K back in 1985, giving you a 2% ownership interest in the franchise. Today, that 2% is worth $60 MILLION DOLLARS. Believe me if you wanted to sell your 2% of the Bulls to somebody for $60 million there would be investors lining up to buy that share, or say you just wanted to get a quick $30 million by selling half of your interest. It would not be hard... in fact JR or any of the other owners would gladly take it off your hands. So, cashing out would be easy. This is why the value of the team is much more important than the difference between net income of $98M for the year vs. $114M.
The value of the franchise is the real PRIZE and the bulk of the real money. Also, putting a better product on the floor (which can be made possible by spending a little more in team salary, if spent wisely, of course) is going to increase merchandise sales, possibly earn the ownership group playoff revenue, and increase fan interest, which is all much more important than reducing operation cost on that side of the balance sheet by ten or twenty million on a season. It's nothing in comparison. Sure, we could find some bean counter who doesn't understand the dynamics of it all and would tell you how equity can't pay the bills, but that just isn't a realistic way of looking at things in this environment. I'm not saying to go out and just piss away money for the hell of it. I'm saying don't handcuff yourself by restricting costs too much.
You think the minority owner cares more about making an extra $300K last year or making a return on his $250,000 investment of $60,000,000? The operation costs are almost negligible in real terms. Meaningless when we are talking about 2% of $10M or something to that effect.
I get all of that Johnny.
But I would want to keep an asset that pays me a dividend EVERY year. A hefty one at that. While also growing in intrinsic stock price.
That's how the Bulls are.
And I guarantee that the next time someone sells, Reinsdorf will buy it and inch closer to being the majority owner. The exact opposite of what this board wants.
Leslie Forman wrote:Assuming absolutely nothing changes with ownership, I would not be surprised if, in 10 years, both NY and both LA teams were ahead of the Bulls on these valuation lists.
coldfish wrote:Leslie Forman wrote:Assuming absolutely nothing changes with ownership, I would not be surprised if, in 10 years, both NY and both LA teams were ahead of the Bulls on these valuation lists.
Its worse than that. If you look, Forbes is still giving Chicago a lot of "goodwill" for being in Chicago and the Jordan years. The revenue is tanking. If that becomes a regular thing over an extended period of time and their revenue keeps falling, they could drop way down in valuation.
Right now, Boston, GS, Houston, LAC, Dallas and Brooklyn could catch them based on market size and team performance. I could see them dropping to 9th almost purely based on poor management.
This year is really huge for them. If this rebuild fails and they have to hit the reset button again, it could be another 3-4 years of the fanbase waiting for a playoff team. By then, there won't be much of a fanbase. Chicago won't support a loser forever. JR was able to buy the Bulls for a song and a dance in 1985 because the city really didn't support the team.
johnnyvann840 wrote:dougthonus wrote:musiqsoulchild wrote:I know what you're talking about Doug. But theres no dividend payout here. Theres no Bulls stock that appreciates in value.
So? People who have billions of dollars can wait for the final sale. Not everyone needs cash. In fact, most people rich enough to own an NBA team don't need cash.I am fairly certain that we are using the profit model to pay off the Advocate Center. Thats what the company I work for did. They financed an acquisition and until the debt for that financing was paid off, we were ultra-profit prioritizing our decisions.
Sure, it doesn't mean those are the only viable models though.
Great points Doug.
Musiq, here's the bottom line (no pun intended). Let's just say you are a minority owner of the Chicago Bulls. Likely, one of JR's cronies who's been around from the beginning. Bought in for $250K back in 1985, giving you a 2% ownership interest in the franchise. Today, that 2% is worth $60 MILLION DOLLARS. Believe me if you wanted to sell your 2% of the Bulls to somebody for $60 million there would be investors lining up to buy that share, or say you just wanted to get a quick $30 million by selling half of your interest. It would not be hard... in fact JR or any of the other owners would gladly take it off your hands. So, cashing out would be easy. This is why the value of the team is much more important than the difference between net income of $98M for the year vs. $114M.
The value of the franchise is the real PRIZE and the bulk of the real money. Also, putting a better product on the floor (which can be made possible by spending a little more in team salary, if spent wisely, of course) is going to increase merchandise sales, possibly earn the ownership group playoff revenue, and increase fan interest, which is all much more important than reducing operation cost on that side of the balance sheet by ten or twenty million on a season. It's nothing in comparison. Sure, we could find some bean counter who doesn't understand the dynamics of it all and would tell you how equity can't pay the bills, but that just isn't a realistic way of looking at things in this environment. I'm not saying to go out and just piss away money for the hell of it. I'm saying don't handcuff yourself by restricting costs too much.
You think the minority owner cares more about making an extra $300K last year or making a return on his $250,000 investment of $60,000,000? The operation costs are almost negligible in real terms. Meaningless when we are talking about 2% of $10M or something to that effect.
musiqsoulchild wrote:I get all of that Johnny.
But I would want to keep an asset that pays me a dividend EVERY year. A hefty one at that. While also growing in intrinsic stock price.
That's how the Bulls are.
And I guarantee that the next time someone sells, Reinsdorf will buy it and inch closer to being the majority owner. The exact opposite of what this board wants.
dougthonus wrote:musiqsoulchild wrote:I get all of that Johnny.
But I would want to keep an asset that pays me a dividend EVERY year. A hefty one at that. While also growing in intrinsic stock price.
That's how the Bulls are.
And I guarantee that the next time someone sells, Reinsdorf will buy it and inch closer to being the majority owner. The exact opposite of what this board wants.
Dividends are often a poor sign for growth. It's a statement that you believe you can no longer grow equity by reinvesting in your company so you give money back to investors. Dividend stocks are generally very conservative by nature and don't have nearly as much equity growth as non dividend stocks.
If you prefer dividend stocks, that's fine. However, the idea that you will get large equity growth and dividends is typically contradictory for the reasons outlined above. If a company believes it can invest to gain more equity growth than the dividend it pays out then it will generally do that.
Ccwatercraft wrote:sell Reinsdorf's and other's share, just enough to give majority ownership to the love child of Steve Ballmer and Mark Cuban, if such a person can be found.
musiqsoulchild wrote:dougthonus wrote:musiqsoulchild wrote:I get all of that Johnny.
But I would want to keep an asset that pays me a dividend EVERY year. A hefty one at that. While also growing in intrinsic stock price.
That's how the Bulls are.
And I guarantee that the next time someone sells, Reinsdorf will buy it and inch closer to being the majority owner. The exact opposite of what this board wants.
Dividends are often a poor sign for growth. It's a statement that you believe you can no longer grow equity by reinvesting in your company so you give money back to investors. Dividend stocks are generally very conservative by nature and don't have nearly as much equity growth as non dividend stocks.
If you prefer dividend stocks, that's fine. However, the idea that you will get large equity growth and dividends is typically contradictory for the reasons outlined above. If a company believes it can invest to gain more equity growth than the dividend it pays out then it will generally do that.
I agree 100%. Bulls are analogous to a very mature company. Growth rates by default are tepid.
Everytime ColdFish brings up our poor growth rates, I tell him the same thing. We cant grow like a GSW or a Brooklyn or even an NY/LA. We are a super mature franchise and have a high market saturation.
musiqsoulchild wrote:Ccwatercraft wrote:sell Reinsdorf's and other's share, just enough to give majority ownership to the love child of Steve Ballmer and Mark Cuban, if such a person can be found.
You wrote one sentence. The improbability of that becoming reality though is infinitesimally small.
