NFL Team Valuations 2023: Cowboys Worth $9.2B, Average Tops $5B
The Washington Commanders had the NFL’s worst attendance last season. Their revenue ranked among the bottom dozen teams in the sport. The brand has been badly tarnished over the past decade. And yet, Josh Harris just led a group that paid $6.05 billion for the franchise, smashing the record price for a sports team set just 12 months before by Rob Walton’s $4.65 billion agreement to buy the Denver Broncos—topping a bid by Harris.
Harris is a longtime fan of the franchise, but this was not an ego or vanity buy. The 58-year-old has spent three decades making himself and many others very rich through shrewd deal-making at Apollo Global Management, which he co-founded in 1990. He sees value in this investment. The prospectus shared with potential investors had a base case valuation of $15.5 billion to $17.4 billion in 10 years and an upside of nearly $20 billion.
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“It’s our job as stewards to reconnect with the Washington area and recreate the joy and happiness this team provided,” Harris said when asked through an intermediary. “Given the talent, business acumen, diversity, and overall strength of our ownership group, we can make Washington a top franchise in the NFL once again.”
Yes, the NBA has made huge strides over the past 10 years, and the English Premier League has the biggest global reach in sports, but the NFL remains the undisputed financial king among sports leagues. The foundation of its riches: media agreements worth $10 billion-plus annually and cost certainty from its collective bargaining agreement that make every team significantly profitable.
Sportico spoke with more than 35 bankers, lawyers, team executives, owners and consultants involved in the NFL over the past month and determined that the average team is worth $5.14 billion, up 24% from last year by our calculations. Collectively, the NFL’s 32 teams are worth $165 billion, including team-related business and real estate held by owners.
The Dallas Cowboys rank first in the NFL, and across all sports leagues around the globe, with a value of $9.2 billion, well ahead of the New York Giants ($7.04 billion) and Los Angeles Rams ($6.98 billion). Of the 25 most valuable sports franchises in the world, 16 are NFL teams, followed by three each in the NBA, MLB and global soccer; click here for the complete ranking list and here for the valuations and financial information of the 32 teams, as well as a detailed methodology.
League Economics
“The NFL is viewed as the gold standard in the way it is managed, for its finances, and for its future,” Marc Ganis, NFL consultant to multiple teams, said in a phone interview. “There's an argument to be made that the valuations, as high as they are, are actually modest.”
On a revenue multiple basis, which remains the standard method for sports team valuations, the NFL is still a tick behind the NBA. The Commanders sale was 10.2 times team revenue, plus a $500 million valuation on the real estate around its practice facility and stadium. In the NBA, the recent sale of the Charlotte Hornets ($3 billion) was at a comparable multiple, but the Phoenix Suns ($4 billion) sold for 13 times revenue.
There are still plenty of teams in the NBA, NHL and MLB that lose money. Almost every MLS team runs a deficit. In the NFL, it is impossible to be in the red. National revenue from media and sponsorship partners was $12 billion last year, or 64% of the league’s $17.8 billion in total revenue. It meant each team received nearly $375 million before selling a ticket, beer or local sponsorship; it will approach $400 million this season. Meanwhile, player costs represent more than half of annual expenses and are determined by a salary cap that moves in lockstep with revenue. The cap was $208 million last year with teams also required to kick in more than $40 million apiece for player benefits. Cash payrolls move up and down each year, which meant lower profits for the Bills, Packers, Rams and Saints in 2022, as well as higher ones for the Bears, Bengals and Falcons, but it smooths out over a 10-year period as teams are required to spend their salary cap allotments under terms of the CBA.
Sportico estimated earnings on a cash basis, instead of accrual accounting. We found teams collectively generated $4.4 billion in earnings before interest, taxes, depreciation and amortization (EBITDA), or $137 million per team. Compare that to the Premier League, where 65% of teams lost money during the 2021-22 season after accounting for player trading, and their collective loss was $550 million. Manchester City was the top performer, with a $59 million profit. Every NFL team made more than that last season, and the Cowboys raked in an estimated $460 million before taxes, followed by the Patriots ($265 million) and Giants ($215 million).
And despite the soaring valuations, no NFL owner is rushing for the exits, a sign that Harris is not the only one who thinks values can triple over the next decade. There are a handful of owners exploring sales of minority stakes, but most of those moves are tied to estate planning and taking a few dollars off the table in a league where the average age of owners is 73.
There have been only four teams sold over the past decade, and two—Denver and Buffalo—were tied to the deaths of owners, while the other two—Washington and Carolina—were accelerated by allegations of misconduct in the ownership suite. The average ownership tenure is four decades. There are no control stakes available right now.
Contrast that to the NBA, where 11 teams have sold over the past decade, including a trio by owners—Robert Sarver, Marc Lasry and Michael Jordan—who cashed out since December at valuations between $3 billion and $4 billion. “I thought it was the right time to sell,” Lasry told Bloomberg in May. “We’ll find in five years if it was right.”
The guaranteed profits and $120 billion worth of domestic media deals locked in for the next nine years have pushed the entry price for an NFL franchise to $4 billion, with the Cincinnati Bengals ranked No. 32. A dozen NFL teams generated more than $200 million in local revenue last season from tickets, sponsorships, luxury suites and non-NFL events, but there is not a significant variance within the other 20 who averaged $159 million in local revenue. The result is that most teams are valued in a narrow band between $4 billion and $5 billion.
The Cowboys generated $1.05 billion in revenue last season, becoming just the second sports franchise in the world to top $1 billion after FC Barcelona. The Cowboys have only four playoff wins since 1997 but have revolutionized how NFL teams run their businesses, from sponsorships to stadiums to mixed-use developments. Dallas’ sponsorship revenue exceeded $200 million last year, while luxury suite revenue topped $100 million.
Institutional Money
The Harris group has been embraced by the Washington football faithful who long for the pre-Dan Snyder era. “I grew up rooting for this team and remember when it was the top franchise in the NFL,” Harris said. “I remember how much this team meant to the fan base and the community. This city used to shut down on Sundays for games, and I understand the intrinsic value this franchise provided for so many.”
Ownership immediately spent $2 million to improve the fan environment at training camp, including bleachers on the sidelines. Commanders president Jason Wright said season ticket sales have been running eight to 10 times faster than what they were last year. The club has already surpassed 2022 totals for tickets and suites. "We are now able to go to the market and do [sponsorship] deals like everybody else," Wright said in a video interview, adding that he had a lot of "tough conversations" with Commanders partners over the past three years.
The good times have returned in D.C., but those in NFL HQ at 345 Park Ave. are certainly huddling to review the sales process so they can figure out how to keep finding buyers at $6 billion valuations, as well as $20 billion ones in 10 years.
Recent NFL sales have had one person write a check for most or all of the purchase amount, including Walton's Broncos, David Tepper's Panthers and the Pegulas' Bills. The Commanders' sale didn’t work out that way. Harris eventually got the deal across the finish line but wanted to borrow more than the $1.1 billion limit, bring in institutional investors and hold less than the 30% required for the lead owner. The ownership group was around 20 people in the end, and roughly $200 million of the $6.05 billion purchase price went into an escrow account that is tied to the team's financial performance over the next couple of years.
The consensus is that the NFL will eventually open itself to institutional capital, as the other major North American sports leagues have. But momentum on that rule change seems to have slowed over the last 12 months. There are currently eight to 16 owners on board for institutional money, depending on who is counting the votes, but a positive recommendation from Roger Goodell or the powerful finance committee would help boost that total.
The acquisition debt limit appears likely to be adjusted before the NFL changes its rules around allowing private equity and pension funds to invest. Teams can currently borrow $600 million and prospective buyers can add an additional $500 million to that limit, which was agreed to in 2021. Valuations are up 46% since then, and multiple team owners thought Harris should have been allowed $2 billion in debt or one-third of the purchase price.
There was disappointment by certain owners after Tepper secured the Panthers for $2.28 billion. Some had visions of $3 billion for the club in 2018. The league responded by eliminating the cross-market ownership restrictions and increasing the debt limit. Harris’ Commanders buy was a record but some question if $7 billion was possible if ownership restrictions were loosened.
What’s Next
The NFL has its two biggest ticket items checked with its TV deals and labor peace through the decade. It dominates TV, with 82 of the 100 most-watched broadcasts last year, but it is always looking at new opportunities as it pursues Goodell’s revenue goal of $25 billion by 2027. Legalized sports betting is only in the first quarter, and there is a new push for international growth with the NFL playing more games outside the U.S. and enlisting the teams by granting them territorial rights in certain countries.
The NFL is bullish on its partnership with Skydance Media, the studio behind Top Gun: Maverick and Air, to create football content, from lifestyle shows to documentaries to full-length films. The league is also focused on building out its massive centralized fan database, which will help with fan engagement and monetization, and potentially lay the groundwork for a more direct-to-consumer model in the future.
Yet, the biggest near-term opportunity for expanding the business of the NFL is on the stadium side. Only two venues, SoFi Stadium in Los Angeles and Allegiant Stadium in Las Vegas, have opened during the past five years, and no others will open before 2026, when the Buffalo Bills expect their new home to be finished. The two openings will mark the fewest in any eight-year period in more than three decades.
But behind the scenes, half of NFL teams are evaluating their buildings. “It’s as active of a period as I’ve ever seen,” Mike Ondrejko, head of Legends Global Sales, said in a February video interview.
Most of the potential action is happening in the bottom half of the NFL’s financial table, with the Commanders and Bears notable exceptions as big market teams seeking new venues. The Bills, Titans and Ravens all rank among the bottom 12 teams by revenue but have secured a combined $2.7 billion in public funding to fuel their stadium plans, with new buildings in Buffalo and Nashville and a renovation in Baltimore.
Teams are increasingly looking at the area around the stadium for potential developments, following the model of Patriot Place in New England and SoFi Stadium in Los Angeles. Every situation is unique, though.
“The most important thing when you are looking to build a new stadium or renovate a stadium is to do what’s right for your market,” Kevin Demoff, Rams president, said in a video interview. “SoFi Stadium is wonderful for L.A. It wouldn’t work in so many other markets. When people come, we always try to walk through the intent of what we were trying to do."
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