Madison Square Garden Sports: Navigating the Challenges of Two Iconic Franchises

Madison Square Garden Sports (MSGS) owns the NBA's Knicks and NHL's Rangers, two prominent franchises in New York. Despite their success, the teams face various constraints, including high operating costs, intense media scrutiny, and limited revenue streams. MSGS must balance their financial goals with the need to maintain a competitive product and satisfy their fan base.

Madison Square Garden Sports (MSGS), the parent company of the New York Knicks (NBA) and New York Rangers (NHL), has recently seen increased analyst interest and positive ratings. Citigroup and Morgan Stanley have both initiated coverage on MSGS, with Citigroup assigning a "buy" rating and a price target of $285.00, suggesting a potential 40.37% upside from its current price. Morgan Stanley raised its price target to $220.00, rating the stock as "equal weight" Citigroup Begins Coverage on Madison Square Garden (NYSE:MSGS)^[1].

Despite these positive analyst views, MSGS faces several challenges. The company reported a negative net margin and earnings per share of ($0.07) for the latest quarter, despite exceeding revenue expectations. High operating costs, intense media scrutiny, and limited revenue streams are significant constraints for the company Citigroup Begins Coverage on Madison Square Garden (NYSE:MSGS)^[1].

Analysts at Citigroup believe that MSGS is currently undervalued relative to third-party valuations and recent transaction multiples. Steven Sheeckutz, an analyst at Citigroup, sees scope for the valuation gap to close, driven by favorable private market trends and a potential minority interest sale of either the Knicks or Rangers Buy MSG Sports as New York Knicks and Rangers parent is being underestimated, Citi says^[2].

Shares of MSGS have pulled back more than 10% in 2025, but they gained 2% in the premarket on September 12, 2025. The stock has a market capitalization of $4.87 billion, a PE ratio of -220.69, and a beta of 0.78. Institutional investors and hedge funds own 68.94% of the company's stock Citigroup Begins Coverage on Madison Square Garden (NYSE:MSGS)^[1].

In conclusion, while MSGS faces significant challenges, analysts see potential upside in the stock. Investors should consider these challenges and analyst views when making investment decisions.