What’s up WSB. As previously mentioned (before the mods nuked my last post for “promoting gambling,” on THIS sub, lmao), I took out a $15,000 Amex loan to “invest” in the Knicks game 1. Then, I rolled my profits into the Knicks game 2, hit again. I faded game 3 (I’m the best), rolled into 4 and 5 and won a grand total of $16,002 (Images excluded b/c rest was on a certain gambling site and the mods don’t fw that). Now I’m rolling it into $MSGS calls at open.
https://preview.redd.it/oahj0s2fbd7h1.png?width=943&format=png&auto=webp&s=948d977d398ab0f92e51f24bdb21f9bd592c4e2b
https://preview.redd.it/p447iukfbd7h1.png?width=1320&format=png&auto=webp&s=c1a88eaa38f8fe18245ff18b0d389d56f202d6f7
The DD
MSGS is the parent company of the Knicks (NBA) and the Rangers (NHL). It is one of the only ways to trade sports teams in the stock market. The Knicks are privately valued at \~$10B, and the Rangers at \~$3.8B. Despite owning $13.8B in sports equity, MSGS’ market cap trades at only $9.3B, a 30% discount to net asset value (NAV). Mr. Market is selling you a dollar for seventy cents.
The CEO (Dolan) looked at that \~30% holdco discount and recently filed a Form 10 to break up the company and spin the teams out into separate publicly traded companies. Stop burying the Knicks (\~$9.9B private mark) inside a conglomerate, force the market to price it against real comps, and the discount evaporates. SOTP screams \~$555/share vs. \~$383 now.
Cherry on top, and the part the suits still haven’t stuck in their pointless 900 line models: the Knicks aren’t a 50% bet anymore. Polymarket settled at 100% because they actually won the thing. A ring resets the entire franchise mark. Banner years drag up private valuations, season ticket pricing, merch, and the exact comp set the spinoff gets measured against. And even if every catalyst whiffs, each playoff home game already printed \~$20M+ in operating profit. There is no version of this math that points down.
The options play
IV on MSGS options is only \~45%. This is almost nothing compared to the 200-300% numbers I’m used to trading!
- ATM calls: easy 10x
- OTM calls: 100x when the Knicks close it out
Options are dirt cheap, the catalyst already cleared the building. Heads I win $280k, tails I only owe Amex $2.8k.
Icing on the cake is that 95% of MSGS’s float is held by the Dolan family and large institutions. So any small change to the \~5% of shares available for trading on the public market will catapult the stock into the stratosphere.
Risks
The Wemby risk I flagged last time? He went 19 and 14 with 5 blocks Saturday and the Spurs still lost the series 4-1. The boogeyman showed up and got sent home. Only thing left to fear is a sell-the-news fade at the open and the spinoff timeline slipping.
Positions above ($MSGS 450c, 480c for both 6/18 and 8/21). Not financial advice.