Guggenheim Securities initiated coverage of MSG Rangers with a buy rating and a price target of $278, suggesting a potential upside of nearly 57% from its recent close. Similarly, they set a buy rating for MSG Knickerbockers with a target of $445, indicating a 46% upside.
Analyst Curry Baker noted that the spinoff, which occurred after the Knicks' first NBA championship in 53 years, could unlock multiple value-enhancing opportunities for both franchises. Despite MSG Rangers' shares dropping nearly 7% to $177.61, the Knicks' shares rose almost 6% to $305.42.
Baker highlighted potential catalysts for the Knicks, including NBA expansion in Las Vegas and Seattle, which could generate significant revenue. He also mentioned that the Rangers might benefit from tax advantages resulting from the spinoff, providing flexibility for future strategic actions, especially with upcoming tax code changes in 2028.
Overall, the separation is seen as a strategic move that could enhance shareholder value for both teams