Madison Square Garden Sports Corp. (MSGS): A Bull Case Theory

We came across a bullish thesis on Madison Square Garden Sports Corp. on Valueinvestorsclub.com by juice835. In this article, we will summarize the bulls’ thesis on MSGS. Madison Square Garden Sports Corp.'s share was trading at $208.57 as of June 27^th. MSGS’s trailing and forward P/E were 1.04k and 147.06 respectively according to Yahoo Finance.

Madison Square Garden Sports (MSGS) offers a highly compelling long-term investment opportunity, particularly given today's elevated market valuations and macro uncertainty. The company owns iconic sports franchises, including the New York Knicks and New York Rangers, which command immense brand equity and scarcity value.

The stock currently trades at a 55% discount to its intrinsic value based on Sportico’s $11.5 billion valuation for the two teams, net of $1.1 billion in debt and divided by 25 million fully diluted shares—implying a fair value of $416 versus the current price of $185. Despite investor concerns around the regional sports network (RSN) reset with MSG Networks, the rights fee reductions (28% for the Knicks and 18% for the Rangers) were much smaller than feared, and national media rights—now a larger revenue driver—are strengthening, evidenced by the NBA’s $76 billion broadcast deal.

Further bolstering the investment case is a 17% increase in Knicks season ticket prices, which should enhance forward cash flow. MSGS is also trading at just 4.6x estimated 2026 revenue, versus 8–10x typical team valuations. While concerns over governance under James Dolan and the lack of a near-term catalyst persist, prior shareholder-friendly moves like a $75 million buyback and a 7% special dividend show capital discipline.

Recent record-setting NBA team sales, such as the Boston Celtics at $6.1 billion, underscore the durability of franchise valuations, even for less commercially integrated teams. With limited macro exposure and growing intrinsic value, MSGS offers asymmetric upside for patient, long-term investors despite a vague timeline for unlocking that value.

Previously we covered a bullish thesis on Madison Square Garden Sports (MSGS) on Boyar Research’s Substack by Boyar Research and Jonathan Boyar in October 2024, which highlighted the valuation gap, institutional interest, and potential spin-offs. The company’s stock price has appreciated approximately by 0.12% since our coverage. Juice835 shares a similar view but emphasizes on media rights strength and ticket pricing power.

MSGS isn't on our list of the 30 Most Popular Stocks Among Hedge Funds. While we acknowledge the risk and potential of MSGS as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock.

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Disclosure: None. This article was originally published at Insider Monkey.