Courtside's The 4th Quarter: The NBA & NHL’s First Publicly Traded Sports Teams

This is a special week for The 4th Quarter.

For the first time in our newsletter’s history, we’re announcing an AI partnership - and it’s not with just any company.  It’s a product we use every day to power all of our research and modeling.

Today, we’re putting Endex to work to break down the MSG Sports spin-off that could turn the New York Knicks and New York Rangers into two separately publicly traded companies.

We used Endex throughout this entire piece - and built a full financial analysis in minutes. 

Endex is an AI financial modeling tool built directly inside Excel, backed by OpenAI.

It allows you to generate clean financial models, charts, and analyses simply by prompting it - without leaving your spreadsheet.

Last week, we wrote about the Entire AI Stack We’d Use If We Owned A Sports Team. 

If you want the easiest “day-one” upgrade without adopting a whole new stack, start by adding Endex to your workflows.

If you’re an investor, operator, team executive - or spend more than 5 minutes in spreadsheets a week - this was made for you & your team. 

But instead of just telling you what it does, we figured we’d show you.

2026 might be the year New Yorkers finally get to fulfill their ultimate sports fantasy: owning the iconic New York Knicks.

Well… not exactly.

Two weeks ago, Madison Square Garden Sports Corp (NYSE: MSGS) announced that its board of directors are exploring a potential “spin-off” that would separate its two iconic franchises into distinct publicly traded businesses: the New York Knicks (including their G-League affiliate, the Westchester Knicks) and the New York Rangers (plus their AHL affiliate, the Hartford Wolf Pack). 

CEO and Chairman James Dolan stated that the move would “provide each company with enhanced strategic flexibility, its own defined business focus, and clear characteristics for investors.”

In plain English: Blueshirts and Knicks faithful can now choose which team they want to own in their 401(k).

If approved, this would be unprecedented. The Knicks and Rangers would become the first NBA and NHL franchises, respectively, to trade publicly as standalone entities.

Pretty awesome, right?

But to truly understand what the MSG executive team means by “strategic flexibility” and “defined business focus”, we need to rewind to June 2025. That’s when Boyar Value Group published an open letter to James Dolan arguing that MSG Sports was materially undervalued.

That “billions of dollars unlocked” is the key to all of this.

In today’s deep dive, we’re breaking down why:

The Knicks and Rangers mispricing ultimately comes down to how sports teams are evaluated in private versus public markets.

Let’s start with the private market. 

The Knicks are one of the most sought-after assets in the world - a storied franchise in the epicenter of sports and entertainment. According to CNBC’s 2026 estimates, the private market values the team at $10.1B, ranking #2 in the NBA behind the Warriors. 

This aligns with the recent ~$10B sale of the Lakers, which is likely the best comparable. Like the Knicks, the Lakers operate in a marquee city, have a global brand, strong regional media rights, and elevated ticket and merchandise sales relative to most NBA teams.

The Rangers tell a similar story. They’re the #2 most valued franchise in the NHL, valued at $3.8B in the private markets per CNBC’s NHL estimates. 

We had Endex put together a sum-of-parts valuation analysis to find the “true value” range for MSG Sports:

Quick breakdown of the nuances involved:

As you can see, MSG Sports should theoretically be valued in the $11-12B range, broadly in line with the views of Mario Gabelli (whose investment firm owns ~5% of the entity) in his recent CNBC interview.

But how is MSG Sports valued in the public markets?

Not so generously.

Based on recent stock performance, MSG Sports trades at roughly a $7.9B market capitalization. The Knicks alone (excluding arena value) are valued at $8.2B based on recent private-market estimates. From Jonathan Boyar’s perspective, not only are the public markets underpricing the Knicks, they’re effectively “assigning no value whatsoever to the Rangers”.

While public markets can misprice assets, we’ve rarely seen something this stark.

For example, the only other major publicly traded sports franchise in the U.S. is the Atlanta Braves. Forbes estimates the Braves’ valuation at roughly $3B, nearly identical to the current market cap of Atlanta Braves Holdings.

So what’s driving this massive discrepancy?

A term often thrown around to explain this mispricing is the “Dolan Discount”. 

This refers to the valuation haircut public investors apply to MSG Sports because the Dolan family maintains tight voting control, limiting shareholder influence. Looking at the current cap table, despite owning only a 21.5% economic interest in the business, the Dolan family controls ~71% control of the total voting power:

While this ownership structure makes sense for a traditional sports franchise, it’s less attractive for public shareholders. Why? Because investors assume the full value of the underlying assets may never be realized if the controlling ownership group is perceived as unlikely to sell.

And in sports, a sale is often the most realistic path to meaningful return on investment.

Team valuations are driven more by scarcity than cash flow - these teams aren’t exactly printing profits. Public investors aren’t expecting consistent dividends or aggressive share buybacks (finance speak for the company buying back its own stocks) as they’re instead underwriting for long-term asset appreciation.

But governance isn’t the only issue.

Another layer of the “Dolan Discount” is the bundling of two franchises, which can create significant friction for potential investors:

All of this directly limits the “strategic flexibility” that Dolan referenced in the company’s press release. Given the current governance structure, asset bundling, and limited reporting transparency, it becomes harder for ownership to pursue minority sales or liquidity events that could boost shareholder value.

To put this into perspective, we had Endex benchmark the performance of MSG Sports against the S&P 500 and Ross-Arctos Sports Franchise Index (a benchmark tracking the value appreciation of major sports U.S. sports franchises) in the last three years:

As you can see, the delta between MSGS and RASFI is simply way too wide. The Knicks and Rangers are marquee franchises: they should be performing even better than the aggregated sports franchise benchmark.

So what does the spin-off actually change?

We wouldn’t be surprised to see a minority stake sold in either franchise within the next two years. 

If the “Dolan Discount” is resolved, we estimate a ~35% value appreciation across both franchises. The spin-off doesn’t just unlock value but it creates a clean path for the Dolan family to seek liquidity at the right price.

And it wouldn’t come at the expense of the shareholders. 

Under IRS Section 355, a spin-off would actually be a tax-free event. Selling a stake under the current holding structure likely triggers a taxable event on the gain. 

The Knicks and Rangers were acquired in the late 90s for a combined ~$500M. If the combined value today is $11B, that implies a potential taxable gain of ~$10.5B under a direct sale.

That’s a massive tax bill.

A spin-off fixes the structure first - and gives ownership optionality later. That’s what “strategic flexibility” really means.

There’s a reason sports properties stay private.

Typically, companies go public to improve finance flexibility, gaining broader access to capital from the public markets. But for sports properties like the Knicks and Rangers, it has led to enormous mispricing and inflexibility. 

The spin-off is a message to the broader sports industry to be cautious of the public markets.

But to be fair - no one’s considering it. 

The private markets are just a much nicer place to play.

Chinese billionaire Lin Bin acquires 1% stake in the Miami Dolphins holdco at a $12.5B valuation (Mar. 3rd)

Euroleague Basketball targets $2.91B capital raise to fund franchise model (Mar. 3rd)

USL lands Weatherford Capital investment ahead of 2028 promotion-relegation system launch (Feb. 26th)

Equipe, a sports customer data platform, raises $1.5M in Seed funding (Mar. 2nd)

Devotion, an AI-powered creator marketing platform, raises $4M in Seed funding (Mar. 2nd)

XENOM, a global functional fitness competition series, raises $15M Seed in funding to launch (Feb. 27th)

Paramount advances with $111B bid for Warner Bros. Discovery as Netflix exits; HBO Max, Paramount+ to merge into one streaming service (Feb. 27th)

MyFitnessPal, a calorie-tracking app for fitness & weight management, acquires AI photo-recognition nutrition-tracking app Cal AI (Mar. 2nd)

Teamworks reportedly set to acquire football news & analysis platform Pro Football Focus at a $130-$140M valuation (Feb. 25th)

Betr, a real-money, micro-betting super app, partners with Polymarket to launch prediction markets to 1M users (Mar. 4th)

TWG Global launches ticketing analytics platform ‘RightsHelper’ developed within the LA Dodgers organization (Mar. 3rd)

Premier League and telecommunications conglomerate StarHub unveil first DTC platform ‘Premier League+’ in Singapore (Feb. 26th)

If you find our weekly job board helpful, join the T4Q Talent Network.

Now - here are some cool roles we found and personally curated this week. Enjoy!

1. Highmount Capital - Jr. & Sr. Investment Professionals (Sports, Media)

2. Left Lane Capital - Investor: $105K

3. Youth Inc. (Greg Olsen’s Youth Sports Platform) - Product Manager (Reach Out If Interested)

4. US Olympic & Paralympic Committee - Sr. Director, Commercial Ventures: $170k

5. Track Titan - Product Manager: $99K

6. Apple - Games Business Development, App Store: $211K

7. Oura - Director of Corporate Strategy: $236K

8. MADE Hoops - Creative Strategist & Brand Partnerships

9. McLaren Racing - Head of Content

10. MrBeast - Head of TikTok