Forbes values the Royals at $1.11 billion

The Royals are valued at $1.11 billion, according to the latest estimates from Forbes magazine released this week, a 5 percent increase from their valuation a year ago. This comes despite a pandemic that shortened the season in 2020 and a work stoppage this off-season. Only the Marlins and Rays are ranked lower in valuation among MLB teams however, with the Yankees topping the list at $6 billion. Overall, the valuations increased nine percent this year, the largest increase in four years.

According to their estimates, MLB teams did suffer financial losses in 2020 and 2021 due to the pandemic. Forbes estimates that after having $1.5 billion in operating revenue in 2019, MLB teams lost a collective $1.14 billion over 2020 and 2021 combined. But teams are expected to bounce back nicely this year with several new revenue streams. Players agreed to sponsor patches on uniforms, which could generate up to $400 million for teams annually. Baseball will also bring in at least $65 million in television revenues by expanding the playoffs from 10 teams to 12, and recently signed new deals with ESPN, Apple+, and Peacock exceeding $2 billion.

Teams also have local television deals which have continued to go up in recent years. The Los Angeles Dodgers have the most lucrative local television deal at $189 million, while the Royals have a deal with Sinclair Broadcasting Group, which owns Bally Sports Kansas City, that will pay the team between $48-52 million per season. Some of these deals can be obfuscated by the fact that teams own equity stakes in some of the regional sports networks that carry their games.

Forbes estimates the Royals have $47 million in operating income, higher than the estimated $22 million average operating income by MLB teams in 2021. Baseball Prospectus projects the Royals to have an $87 million Opening Day payroll the eighth-lowest in baseball, but higher than the $51 million projected by the Cleveland Guardians and $36.8 million projected by the Pittsburgh Pirates. The Dodgers are projected to be the top payroll at $276.3 million.