In a recent report, Fitch Ratings confirmed the NFL's excellent credit ratings on its various lending facilities. The rating outlook for all debt is stable, providing reassurance to investors. The NFL recently increased its debt limit for teams to $700 million and for buyers of a team to $1.2 billion. The league's credit ratings reflect its strong financial position and long-term revenue potential.
One of the key factors supporting the NFL's credit ratings is its national media deals, which are projected to bring in over $126 billion by 2033. These deals provide significant revenue and cost visibility compared to other leagues. The NFL's collective bargaining agreement with players also contributes to its financial stability.
The report also highlighted the NFL's dominance in the U.S. sports ecosystem. With its media partnerships, including agreements with Amazon and Google, the NFL embraces the transition of digital viewing trends. This positions the league as the leading sport on TV, dominating the top 25 TV programs during the regular season.
The NFL's credit ratings are further supported by rising team valuations, stadium improvements, and strong viewership trends. Team valuations continue to rise, with the recent sale of the Washington Commanders for a record $6 billion. Stadium improvements and high paid attendance contribute to increased revenue, while viewership levels for certain games have reached record-breaking levels.
The additional debt capacity provided by the increased limit could be beneficial for the NFL in the future. Unlike other leagues, the NFL does not permit institutional investors to buy pieces of teams. This restriction limits potential sources of investment, making additional debt a valuable tool.
Overall, the NFL's excellent credit ratings reflect its strong financial position, long-term revenue potential, and dominant position in the U.S. sports landscape. The league's ability to secure lucrative media deals, maintain high viewership, and increase team valuations contributes to its financial stability.