Last week, Michael Jordan sold a majority stake in the Charlotte Hornets at a $3B valuation — returning nearly 11x on his $275M investment.

It’s the seventh-largest sports franchise sale in history (six of these have been in the past 13 months). And it shows just how in-demand sports teams are.

• In the past 40 years, the value of every US team in all four major sports has increased exponentially, per sports writer Dan Moore.
• The average NBA team was worth 15% more in 2022 than the previous year.

Team values have been closely correlated to the worth of soaring broadcasting deals from Amazon, Alphabet and Apple entering the sports world — driving up bids.

Last year, Major League Soccer signed a deal with Apple that’s nearly triple its previous contract. And networks have little option but to compete — with sports being one of the few reasons consumers still subscribe to cable.

The real value of sports teams?

Nearly all sports teams are privately owned except a few. Liberty Braves Group (NASDAQ:BATRA) owns the MLB’s Atlanta Braves and its related real estate properties — which, in 2022, were valued 4x more than in 2010. But there’s more to the value of sports team than just cash flow, per Moore:

• No pro sports team “has ever generated enough revenue to justify its sales price.”
• Values are driven by the credibility and fame that comes with it — and the entry into the exclusive “rich guy clubs.”

Just take a look at the acclaimed Manchester United (NYSE:MANU) — which is in the middle of a bidding war between Middle Eastern and British billionaires.

Next up: Rights to broadcast the NBA is coming due in 2025 — and early estimates suggest the deal could come in 3x over its previous pricetag.