That's what i'm alluding to, there must be another format to calculate the value of football clubs.
Deals ive been involved with have been initially calculated to value a company at 3-5 × revenue. Thats of course before electing to move forward to DD stage.
Valuing companies on revenue multiples only really works when you see a path to increased profitability and in particular, profitability with higher margins. Normally in those circumstances, you're looking at companies with pretty much a fixed cost base so that % increases in revenue go more or less straight through to the bottom line.
Football clubs, with a few exceptions, don't fit that model because as revenues increase, costs tend to increase at pretty much the same rate ( players wages and transfer fees eat up a heck of a lot of any revenue increase ), so you might expect to move into decent profitability, but it'll take a long time and margins are pretty thin.
It's very hard to set an investment case for buying a football club unless some of the following apply :-
- There is an easy way of raising money from the commercial arm ( Man Utd and Liverpool fit this criteria )
- The land they own is worth a lot and money can, at least theoretically, be released from that by moving somewhere cheaper ( Chelsea and Tottenham come to mind )
- You've got a product you want to advertise globally via TV
- The price is cheap
Our commerical arm isn't, to put it mildly, being maximised so a possible buyer might look at that and think there's potential in that area, but Goodison Park is worth very little and, based on the fact that the club hasn't been sold, I think we can assume the price isn't particularly cheap.
Anyone who buys a football club and tries to run it as a "normal" commercial business to turn a profit is going to get a lot of grief from supporters so would have to be very thick skinned ( think Mike Ashley ). Unless you're buying a club because you've got an emotional attachment or want to show off a bit, you'd probably look at it as an option, and quickly see you can get a better return from lots of other things.
Bottom line, if I thought Everton was going to be sold for 2, 3 or 4 times it's current value any time soon, I'd slowly be buying up shares whenever possible. But, while it's nice to have a share certificate showing you own part of the club, it's not really a "proper" investment.