Linball

[qtlaw]

Seems pretty clear from Pablo Torre's story (he talked to Lin) that the Knicks totally forked this up, and if they had not told him he should test the market, they could have had him at a cheaper rate. Houston is the only team that even put an offer in front of him. At any point.

http://m.si.com/news/to/to/detail/5090472;jsessionid=68CED3DAE62595F8D0CCFED0C64ED504.cnnsi1b

Agreed. I think this started with the Knicks really wanting Steve Nash and if they got him they would not have signed Lin or at least low balled him.

He and his agent were smart to keep their leverage while they had it.

I do not get the people criticizing Lin. Sure he was in NYC and that's no doubt why he exploded. But at season's end, he had nothing from the Knicks. If he wrecked his knee water skiing or broke his hip crossing the street, he was a free agent with no contract. Zip, zero guarantees. (Unlike Jerome James, etc.)

Until he signed a contract, he had nothing. Knicks offered zip. So he signs finally a formal offer sheet (oral agreements sound great, but are not an enforceable contract because there is a moratorium, which by definition means no enforceable contracts can be agreed upon) and Knicks declined option to match. Then and only then does Lin have anything.

This is all on the Knicks. Lin is lucky that he got someone to sign him to something, otherwise he's at the mercy of the Knicks and maybe only an offer of a minimum.

 

[Webster]

I do have to say that the fact that MSG's stock price moves up or down is can not be said to be directly related to the performance of a certain player.

Nate Silver compared Cablevision's stock price to the performance of the market as a whole.

It underperformed, and there was no other news that should have moved the stock price.

http://www.thestreet.com/story/11422224/1/jeremy-lin-the-170-million-man.html?kval=dontmiss
Cablevision spun off MSG as it's own stock. When Pre Lin MSG stock price was around 28. When Linball came about stock jumped to 35.

The article says the stock price went up and assumes it must be Lin. It doesn't say why. Same great analysis from a website which touted Lenny Dysktra.

 

[Lugnuts]

Seems pretty clear from Pablo Torre's story (he talked to Lin) that the Knicks totally forked this up, and if they had not told him he should test the market, they could have had him at a cheaper rate. Houston is the only team that even put an offer in front of him. At any point.

http://m.si.com/news/to/to/detail/5090472;jsessionid=68CED3DAE62595F8D0CCFED0C64ED504.cnnsi1b

Good get by him. Well, it is what you'd initially think: Knicks. Completely. Inept.

No use trying to make the situation more complicated than that.

 

[Boom_70]

I do have to say that the fact that MSG's stock price moves up or down is can not be said to be directly related to the performance of a certain player.

Nate Silver compared Cablevision's stock price to the performance of the market as a whole.

It underperformed, and there was no other news that should have moved the stock price.

http://www.thestreet.com/story/11422224/1/jeremy-lin-the-170-million-man.html?kval=dontmiss
Cablevision spun off MSG as it's own stock. When Pre Lin MSG stock price was around 28. When Linball came about stock jumped to 35.

The article says the stock price went up and assumes it must be Lin. It doesn't say why. Same great analysis from a website which touted Lenny Dysktra.

 

[The Big Ragu]

The problem is, that's only useful if you are trading MSG stock, rather than investing in it.

As a trader, you could have made money trying to time the movements of MSG stock. But you'd have to have been able to predict the rise of Jeremy Lin and then the Knicks letting him go to Houston. How likely was that?

Ultimately (if you give things long enough) the valuation for a stock is going to base itself on earnings, not hype. Disney stock might go up due to hype over a movie release, for example. But if you look over time, it always reverts back to a valuation based on actual earnings.

So then the question becomes, how much in future earnings does Jeremy Lin actually translate to. I don't know the answer to that. But I strongly suspect the movements in the stock price have overestimated his impact. I don't know that business well enough to say that for sure, but I do know that some of the obvious things, such as jersey sales, don't just benefit the Knicks. The NBA shares licensing revenue.

So the calculation would be how much Jeremy Lin translates to in tangible earnings for the Knicks. How much does he really impact ticket sales, for example? Will MSG ratings stay higher permanently because of him, and if so, how much does that mean in added ad revenue? What if the novelty wears off, and he stays a really good player, but not an Asian Jesus?

You'd then have to consider those things, and put them next to the $50 million or so in luxury tax and added salary (a number I think I read) to try to guess his long-term impact on MSG's earnings.

At least that is the way an investor, rather than a trader, would do it.

He definitely will drive earnings. Houston will earn more as a result of having him. The question is how MUCH will he drive earnings for the next 3 years?

 

[poindexter]

Henry Abbot:
Carmelo didn't want him. Wasn't part of Anthony's 'vision' for his Knicks.

http://espn.go.com/nba/story/_/id/8180308/nba-jeremy-lin-six-degrees-separation-family

 

[The Big Ragu]

Henry Abbot:
Carmelo didn't want him. Wasn't part of Anthony's 'vision' for his Knicks.

http://espn.go.com/nba/story/_/id/8180308/nba-jeremy-lin-six-degrees-separation-family

I saw that last night and found it unreadable.

Aside from all the poorly edited, fluffy page filler, it was insider's knowledge without any reason given to believe he's an actual insider. About halfway through the first page, I was wondering if I was reading a description of James Dolan being serviced at a brothel or an objective look at things.

 

[cranberry]

Henry Abbot:
Carmelo didn't want him. Wasn't part of Anthony's 'vision' for his Knicks.

http://espn.go.com/nba/story/_/id/8180308/nba-jeremy-lin-six-degrees-separation-family

I saw that last night and found it unreadable.

Aside from all the poorly edited, fluffy page filler, it was insider's knowledge without any reason given to believe he's an actual insider. About halfway through the first page, I was wondering if I was reading a description of James Dolan being serviced at a brothel or an objective look at things.

Yeah, that was just an awful "here's what I think Melo thinks" pile of bullshirt. Are there no editors left in the world?

 

[Evil Bastard (aka Chris_L)]

darren rovell ‏@darrenrovell
With an hour to go until market close, Madison Square Garden has now lost $101M in value in the last 5 days.

 

[Boom_70]

The problem is, that's only useful if you are trading MSG stock, rather than investing in it.

As a trader, you could have made money trying to time the movements of MSG stock. But you'd have to have been able to predict the rise of Jeremy Lin and then the Knicks letting him go to Houston. How likely was that?

Ultimately (if you give things long enough) the valuation for a stock is going to base itself on earnings, not hype. Disney stock might go up due to hype over a movie release, for example. But if you look over time, it always reverts back to a valuation based on actual earnings.

So then the question becomes, how much in future earnings does Jeremy Lin actually translate to. I don't know the answer to that. But I strongly suspect the movements in the stock price have overestimated his impact. I don't know that business well enough to say that for sure, but I do know that some of the obvious things, such as jersey sales, don't just benefit the Knicks. The NBA shares licensing revenue.

So the calculation would be how much Jeremy Lin translates to in tangible earnings for the Knicks. How much does he really impact ticket sales, for example? Will MSG ratings stay higher permanently because of him, and if so, how much does that mean in added ad revenue? What if the novelty wears off, and he stays a really good player, but not an Asian Jesus?

You'd then have to consider those things, and put them next to the $50 million or so in luxury tax and added salary (a number I think I read) to try to guess his long-term impact on MSG's earnings.

At least that is the way an investor, rather than a trader, would do it.

He definitely will drive earnings. Houston will earn more as a result of having him. The question is how MUCH will he drive earnings for the next 3 years?

Well stated Ragu but what I was trying to show in the charts is the direct correlation between the arrival of Jeremy Lin and the rise of MSG stock. I was not speaking to the long term investment value of MSG.

I do think the rise had a lot to do with trader mentality as opposed to investor. The Lin story had a lot of sizzle to it
that clearly translated into a short term stock rise.

I believe that the big driver was the increased TV ratings as opposed to increased ticket sales. Also think that the success of The Rangers was a factor.

 

[YankeeFan]

https://twitter.com/ChandlerParsons/status/247394195151659008/photo/1

 

[Dick Whitman]

So is he starting in the All-Star Game? Or perhaps hanging out with Tim Tebow instead to reminisce about how they both coulda been somebody?