As with most other industries, data analytics is becoming the litmus test for big deals in professional baseball as well. “The analytics group has made its mark,” said Wharton statistics professor Abraham (Adi) Wyner, who is also chair of the undergraduate program in statistics. He is also a host of the Wharton Moneyball program on Wharton Business Radio on SiriusXM.
Wyner drew a parallel between how valuation is done for corporate M&A deals, keeping in mind the net present value of the future cash flows of acquisition targets. “What we assume that the teams should know, but never seem to get, is that you’re paying for the future, not the past,” he said. “Historically that seemed to be what people did, because statistically, people would look at the past and they would project the future by just dragging out the past. That is just not the right way to do it. The data available today has made it better and easier to forecast the future.”
