Serious Question: What is the Topps Co. worth?

Adamsince1981 · Dec 9, 2010

Does anyone know this?

I can't buy it, but I wonder what type of individual/corporation Could by them.

I guess Disney currently owns them???

http://sports.espn.go.com/mlb/news/story?id=2881402

My mouth waters at the thought of Topps falling into GREAT hands! Too bad UD couldn't get it done in 2007....

mburgin · Dec 9, 2010

Adamsince1981 said:
Does anyone know this?

I can't buy it, but I wonder what type of individual/corporation Could by them.

I guess Disney currently owns them???

http://sports.espn.go.com/mlb/news/story?id=2881402

My mouth waters at the thought of Topps falling into GREAT hands! Too bad UD couldn't get it done in 2007....

disney does not own topps. michael eisner and the eisner group own topps. he use to be the CEO of disney.

when topps was publicly traded, he bought all outstanding shares and also bought out all the other shareholders and made the company private again. this is how i understand it. topps is not a publicaly held company anymore.

lisu · Dec 9, 2010

From Wikipedia...

The battle extended into 2007 with a $385 million buyout offer led by the firms Madison Dearborn and Tornante (an investment company started by former longtime Disney CEO Michael Eisner).

This led to discussions of a potential merger with the rival Upper Deck Company, which was prepared to buy Topps for $10.75 per share (a total of about $425 million).

Adamsince1981 · Dec 9, 2010

I heard Warren Buffett speak in person one time and he jokes about owing Coca-Cola shares. He said, "If you see a Coke, open it, I don't even care if you drink it."

Basically he talked about how things like Gum and Coca-Cola will never go away. Well, you would think that is the same with baseball cards and I would assume that is true, for the most part.

But how badly must Topps be ran for me to consider the day when baseball cards go bankrupt??? We have a monopoly that is doing a terrible job and it is simply sickening.

I wish Mr. Buffett would continue with his streak of buying "American Staples" and snatch up Topps. He wouldn't even have to hire me as CEO for me to be happy about it!

011873 · Dec 9, 2010

I was going to let you know but do to a production problem, youll have to send in 18 of your posts to find out.

theplasticman · Dec 9, 2010

011873 said:
I was going to let you know but do to a production problem, youll have to send in 18 of your posts to find out.

:lol:

ThoseBackPages · Dec 9, 2010

"We have a monopoly that is doing a terrible job"

are there numbers to back this up?

just because the high-roller card junkies arent happy with whats out in 2010, whos to say that Topps is doing "poorly"?

200lbhockeyplayer · Dec 9, 2010

Upper Deck is doing a good enough job running Upper Deck into the ground, no sense wondering what "good" they would have done to Topps.

As far as Topps goes, the name alone is worth more than anything else...and it's a valuable name.

Adamsince1981 · Dec 9, 2010

200lbhockeyplayer said:
Upper Deck is doing a good enough job running Upper Deck into the ground, no sense wondering what "good" they would have done to Topps.

As far as Topps goes, the name alone is worth more than anything else...and it's a valuable name.

I did use "worth" in the title. I don't need an "education," I wondered if there was a rumored figure floating around. This is a pretty good place to ask, correct?

bradical · Dec 9, 2010

As a Berkshire Hathaway stock owner, I would be appalled at the acquisition of any sports card related companies.

200lbhockeyplayer · Dec 9, 2010

Adamsince1981 said:
200lbhockeyplayer said:

Upper Deck is doing a good enough job running Upper Deck into the ground, no sense wondering what "good" they would have done to Topps.

As far as Topps goes, the name alone is worth more than anything else...and it's a valuable name.

Click to expand...

I did use "worth" in the title. I don't need an "education," I wondered if there was a rumored figure floating around. This is a pretty good place to ask, correct?

I wouldn't think that this place would even be close to a "good place to ask." People here know baseball cards and know the hobby, but for the most part very little about business. Even less about valuing privately held companies. The only person on this board who could even venture a reasonable guess on the current value of Topps as a corporation would be Brian Gray.

For reference, Eisner's group bought Topps for $385.4 million back in 2007.

TBTwinsFan · Dec 9, 2010

mburgin said:
Adamsince1981 said:

Does anyone know this?

I can't buy it, but I wonder what type of individual/corporation Could by them.

I guess Disney currently owns them???

http://sports.espn.go.com/mlb/news/story?id=2881402

My mouth waters at the thought of Topps falling into GREAT hands! Too bad UD couldn't get it done in 2007....

Click to expand...

disney does not own topps. michael eisner and the eisner group own topps. he use to be the CEO of disney.

when topps was publicly traded, he bought all outstanding shares and also bought out all the other shareholders and made the company private again. this is how i understand it. topps is not a publicaly held company anymore.

Crap... Topps was on OneShare and I thought about buying a share to become "part owner" of Topps :lol: All of a sudden, it dissappeared.

Adamsince1981 · Dec 9, 2010

200lbhockeyplayer said:
Adamsince1981 said:

200lbhockeyplayer said:

Upper Deck is doing a good enough job running Upper Deck into the ground, no sense wondering what "good" they would have done to Topps.

As far as Topps goes, the name alone is worth more than anything else...and it's a valuable name.

Click to expand...

I did use "worth" in the title. I don't need an "education," I wondered if there was a rumored figure floating around. This is a pretty good place to ask, correct?

Click to expand...

I wouldn't think that this place would even be close to a "good place to ask." People here know baseball cards and know the hobby, but for the most part very little about business. Even less about valuing privately held companies. The only person on this board who could even venture a reasonable guess on the current value of Topps as a corporation would be Brian Gray.

For reference, Eisner's group bought Topps for $385.4 million back in 2007.

Thank you for regurgitating information from the 2nd post in this thread. Between the advertisers, Leaf (Brain Gray), the owner, and big name collectors, I thought FCB would be worth a shot.

200lbhockeyplayer · Dec 10, 2010

Adamsince1981 said:
200lbhockeyplayer said:

Adamsince1981 said:

200lbhockeyplayer said:

Upper Deck is doing a good enough job running Upper Deck into the ground, no sense wondering what "good" they would have done to Topps.

As far as Topps goes, the name alone is worth more than anything else...and it's a valuable name.

Click to expand...

I did use "worth" in the title. I don't need an "education," I wondered if there was a rumored figure floating around. This is a pretty good place to ask, correct?

Click to expand...

I wouldn't think that this place would even be close to a "good place to ask." People here know baseball cards and know the hobby, but for the most part very little about business. Even less about valuing privately held companies. The only person on this board who could even venture a reasonable guess on the current value of Topps as a corporation would be Brian Gray.

For reference, Eisner's group bought Topps for $385.4 million back in 2007.

Click to expand...

Thank you for regurgitating information from the 2nd post in this thread. Between the advertisers, Leaf (Brain Gray), the owner, and big name collectors, I thought FCB would be worth a shot.

You're welcome.

I figured that if you read the ESPN article that you linked and took away that Disney owned Topps, you probably need a lot of things repeated for clarification. So again, the total in 2007 was somewhere in the range of $385.4 million based upon an infinite number of variables as a publicly held company. As a privately held company, it's far more difficult pulling the vitals.

My mouth waters for a BBQ sandwich.

jbhofmann · Dec 10, 2010

Maybe Wossa will buy Topps.

Bowman 2011 introduces the brand new 1 of 1 Wossafractor

Leaf · Dec 10, 2010

200lbhockeyplayer said:
Adamsince1981 said:

200lbhockeyplayer said:

Upper Deck is doing a good enough job running Upper Deck into the ground, no sense wondering what "good" they would have done to Topps.

As far as Topps goes, the name alone is worth more than anything else...and it's a valuable name.

Click to expand...

I did use "worth" in the title. I don't need an "education," I wondered if there was a rumored figure floating around. This is a pretty good place to ask, correct?

Click to expand...

I wouldn't think that this place would even be close to a "good place to ask." People here know baseball cards and know the hobby, but for the most part very little about business. Even less about valuing privately held companies. The only person on this board who could even venture a reasonable guess on the current value of Topps as a corporation would be Brian Gray.

For reference, Eisner's group bought Topps for $385.4 million back in 2007.

When Topps was purchased at $380 million (or 9.75 share), the following pieces of information are true to the best of my knowledge (as a Topps Stockholder which I was

):

1> Earnings of the company that year was $7.5 million (or .19 per share)

2> Eisner/Dearborn paid 52 times earnings for Topps (for comparison, Apple trades at 21x, rc2 19x, collectors universe 7x, cisco 15x, microsoft 12x, google 24x)...

3> In the 3 years prior to the transaction, the company's revenue and net income declined each and EVERY year. Topps also had negative cash flow during this period.

4> some businesses like WizKids were dumped well below valuation at time of acquisition, as the business turned south

What does this mean?

- Topps net income would have to at least triple to bring the Price to Earnings multiple down to the average of the above.

- Even if profits tripled, their margins pale in comparison to almost any of the above companies.

- in reality, I would venture a guess (no one knows for sure as they are private) that revenue today and income today is half or less of what it was in 2008, thus Dearborn cost basis is probably 100 P/E Ratio.

With all that being said, how could Dearborn/Eisner have known that the industry would dwindle down to a very small business from where it was? How could they have known that the world economy would tank soon after their deal?

Assuming their profit is still $7.5 million, they would be valued at about $5.70 per share (or $222 million), using a 30 P/E which is still crazy high for a shrinking business.

Unfortunately, I do not believe they are that profitable. I would estimate $2-3 million in net profit for 2009 AT BEST, very possibly even losing money.

IF they made $2 million, that would place their valuation at approximately $75-125 million. (I used a higher multiple to account for cash on hand).

Regardless, at $100-200 million (I believe the lower part of that range), it doesnt appear to be a good buy for Eisner and I would not expect to see them take it back public as they probably originally planned. No serious investor would buy a company shrinking like this at this sort of multiple.

Just my analysis. Not bashing, just facts as I know them.
BG

JoshHamilton · Dec 10, 2010

bradical said:
As a Berkshire Hathaway stock owner, I would be appalled at the acquisition of any sports card related companies.

I'm taking it that you own B, not A

rsmath · Dec 11, 2010

JoshHamilton said:
bradical said:

As a Berkshire Hathaway stock owner, I would be appalled at the acquisition of any sports card related companies.

Click to expand...

I'm taking it that you own B, not A

Doesn't matter, A and B have the same holdings, so anybody holding A or B could make the same comment. Not knowing the current costs of manufacturing and licensing, I don't know how I'd feel about Berkshire adding Topps or other card manufacturers as it isn't obvious to me exactly to what extent of profitability the trading card market has.

I own B's because I am not affluent enough to hold A, plus I can't put A in my Roth IRA while I can some B shares.

As for trading products stinking and bringing down Topps, don't bet on it. IIRC right before they went private, confection made up more of the company than trading cards.

tribefan26 · Dec 11, 2010

Leaf said:
200lbhockeyplayer said:

Adamsince1981 said:

200lbhockeyplayer said:

Upper Deck is doing a good enough job running Upper Deck into the ground, no sense wondering what "good" they would have done to Topps.

As far as Topps goes, the name alone is worth more than anything else...and it's a valuable name.

Click to expand...

I did use "worth" in the title. I don't need an "education," I wondered if there was a rumored figure floating around. This is a pretty good place to ask, correct?

Click to expand...

I wouldn't think that this place would even be close to a "good place to ask." People here know baseball cards and know the hobby, but for the most part very little about business. Even less about valuing privately held companies. The only person on this board who could even venture a reasonable guess on the current value of Topps as a corporation would be Brian Gray.

For reference, Eisner's group bought Topps for $385.4 million back in 2007.

Click to expand...

When Topps was purchased at $380 million (or 9.75 share), the following pieces of information are true to the best of my knowledge (as a Topps Stockholder which I was ):

1> Earnings of the company that year was $7.5 million (or .19 per share)

2> Eisner/Dearborn paid 52 times earnings for Topps (for comparison, Apple trades at 21x, rc2 19x, collectors universe 7x, cisco 15x, microsoft 12x, google 24x)...

3> In the 3 years prior to the transaction, the company's revenue and net income declined each and EVERY year. Topps also had negative cash flow during this period.

4> some businesses like WizKids were dumped well below valuation at time of acquisition, as the business turned south

What does this mean?

- Topps net income would have to at least triple to bring the Price to Earnings multiple down to the average of the above.

- Even if profits tripled, their margins pale in comparison to almost any of the above companies.

- in reality, I would venture a guess (no one knows for sure as they are private) that revenue today and income today is half or less of what it was in 2008, thus Dearborn cost basis is probably 100 P/E Ratio.

With all that being said, how could Dearborn/Eisner have known that the industry would dwindle down to a very small business from where it was? How could they have known that the world economy would tank soon after their deal?

Assuming their profit is still $7.5 million, they would be valued at about $5.70 per share (or $222 million), using a 30 P/E which is still crazy high for a shrinking business.

Unfortunately, I do not believe they are that profitable. I would estimate $2-3 million in net profit for 2009 AT BEST, very possibly even losing money.

IF they made $2 million, that would place their valuation at approximately $75-125 million. (I used a higher multiple to account for cash on hand).

Regardless, at $100-200 million (I believe the lower part of that range), it doesnt appear to be a good buy for Eisner and I would not expect to see them take it back public as they probably originally planned. No serious investor would buy a company shrinking like this at this sort of multiple.

Just my analysis. Not bashing, just facts as I know them.
BG

Eisner recently spoke on CNBC - he was effusive about the business - not that I would expect anything else. He did however point out that much of the success was in Europe.

A few thoughts about the above analysis

- at the time of purchase I thought confections were as big or bigger than sports cards.
- while we can argue all day about the products they have produced, I would think financaially they would have benefitted from the baseball monopoly this year - plus the Strasburgh hype - I will be the first to say that little of that is sustainable, but it seems it should have helped the bottom line (unless they paid a big price to be mlb exclusive).
- I work for a company owned by private equity - a big part of their purcahse is ruthless cost reduction - I suspect they would have done some of that.

I agree they can't have improved the finances of the business since the purchase, but I doubt that it has been as bad as this.

JoshHamilton · Dec 11, 2010

rsmath said:
JoshHamilton said:

bradical said:

As a Berkshire Hathaway stock owner, I would be appalled at the acquisition of any sports card related companies.

Click to expand...

I'm taking it that you own B, not A

Click to expand...

Doesn't matter, A and B have the same holdings, so anybody holding A or B could make the same comment. Not knowing the current costs of manufacturing and licensing, I don't know how I'd feel about Berkshire adding Topps or other card manufacturers as it isn't obvious to me exactly to what extent of profitability the trading card market has.

I own B's because I am not affluent enough to hold A, plus I can't put A in my Roth IRA while I can some B shares.

As for trading products stinking and bringing down Topps, don't bet on it. IIRC right before they went private, confection made up more of the company than trading cards.

Let me rephrase it for you

"I assume you own the $85/share stock, not the $122,000/share stock.

B is still a new concept to me, even though it's been around for probably 12 years now

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