Everton's value has increased by 14 per cent over the past two years despite decline on the pitch.
That is according to analysts at US sports business website Sportico who produced their annual Premier League valuations list on Tuesday, a list compiled through equity research and speaking to a number of key figures involved in sports investment.
The Blues have been pegged by Sportico as having a valuation of $600m (£485m) in the current market, a rise of more than £60m from its valuation in 2021. The figure places Everton at eighth on the Premier League list, leapfrogged by West Ham United after they saw a 33 per cent rise in their valuation over the same period to reach $665m (£535m).
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The metrics typically used to value businesses tend not to be applied so robustly when it comes to valuing football clubs and sports teams in general. It has for some time been based on the strength of the last deals being struck and the idea that the valuations must continue to rise given the size of the broadcast deals struck and how commercial revenues have grown, as well as the view among many investors that there is latent value to be released in Premier League clubs moving forward as they find more ways to engage with their global fan bases.
Speaking to Bloomberg last year, Gerry Cardinale, who owns AC Milan through his RedBird Capital Partners firm and who owns 11 percent of Liverpool owners Fenway Sports Group said: "The valuation discussion is complicated. There isn't a great amount of rigour to it. There is a little bit of LIFO (last in, first out) to it, as in you look at the last trade and you put a mark-up on it. What is alluring there, and deceptive, is that people have become used to everything always going up in sports. That's anti-Darwinian, that's not possible. Now, the slope of that curve may change, but for the foreseeable future everything keeps going up.
"The valuations signal the fact that there is something very premium here, there is scarcity value and there is something very unique in everything that is going on in media and the convergence of (sports, media, entertainment, technology) streams where this is some of the best content that you can access."
On what was a chaotic Tuesday for Everton, reports emerged in the Guardian that Everton owner Farhad Moshiri had put the club up for sale and engaged the services of Deloitte to facilitate the process. The asking price, according to the article, was £500m.
But in the wake of the article Moshiri told the ECHO that the club wasn't for sale, reiterating the stance he gave when speaking to the Everton Fan Advisory Board (FAB) when he met with them last week prior to the weekend's defeat at West Ham United, a game which spelled the end of Frank Lampard's 12 months at Goodison Park.
Moshiri told the FAB: "The club is not for sale, but I have been talking to top investors of real quality to bridge a gap on the stadium. I can do it myself; the reason I want to do it is to bring top sport investors into Everton, for some of the reasons the fans want improvement: more talent. We are close to having a deal done. It is not selling the club at all, it is just bringing more expertise in terms of global sponsorship, commercial development and a lot of specialist sport investors have this pool of knowledge."
The stadium project is something that was set to cost around £500m, although the development, according to comments Moshiri made in an impromptu appearance on talkSPORT earlier this month, could end up costing as much as £760m when all costs are factored in from its inception to completion, and the addition of any ancillary developments are taken into account.
While the Sportico valuation at present may be in tune with the size of a club like Everton and the appeal it has around the globe, the major concern that the football club faces right now is whether or not they will be playing Premier League football next season, sitting second bottom in the division, managerless and having lost out on targets identified to aid their survival bid.
For Everton, who have been a consistent feature of top flight English football since 1954, relegation would be a major financial issue given the drop in revenues that come with the drop and the onerous contracts and liabilities that would exist on the payroll. It would also significantly impact the value of the club, potentially more than halving the current Sportico valuation.
Moshiri has confirmed his position through correspondence with the ECHO, but there is plenty of risk attached.
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