The $11 Billion Sports Empire Trading for $5 Billion
Why is no one talking about MSGS?
In a recent edition of Munger Monday, I wrote about why there’s no formula for getting rich—especially in investing. Over-relying on formulas can blind you to obvious opportunities.
Madison Square Garden Sports Corp (MSGS) may be one of those opportunities.
Let’s break it down.
Madison Square Garden Sports Corp. (NYSE: MSGS) owns two of the most iconic franchises in global sports:
🏀 New York Knicks — valued at $7.5 billion (CNBC)
🏒 New York Rangers — valued at $3.5 billion (Forbes)
👉 Combined: $11 billion in franchise value.
MSGS 0.00%↑ has a market capitalization of $5 billion. Purchasing shares at this valuation gives you a true margin of safety.
(I haven’t purchased shares yet, but I will update you if I decide to. If you haven’t seen my portfolio allocation, you can view it here.)
Just to recap: The public market is valuing the entire company at less than half of its two flagship assets.
One of the reasons for the disconnect is that there is a small group of potential investors who can purchase a sports team.
But that’s not an issue in the NBA.
The Buss family recently sold the Los Angeles Lakers for $10 billion—a record high for any U.S. sports franchise.
This is after the same CNBC report valued the Lakers at $7 billion.
The Lakers purchase price reflects the fact that the Lakers are a globally recognized brand. But so is the Knicks.
According to StubHub, the Knicks lead all NBA teams in international ticket sales for the 2024-25 season, with fans from 66 countries buying tickets.
If I decide to purchase shares, I’ll provide a more in-depth post. Until then, thanks for reading CMQ Investing.
…all intelligent investment is value investment. Because why would you want to buy something which wasn't worth as much as you were paying for it? —Charlie Munger