The 25 Most Valuable Blogs in America

24/7 Wall St. is out with its fourth annual ranking of the 25 most valuable blogs in the U.S., with the caveat that valuation is as much an art as it’s a science. A number of blogs have increased in value since last year, not only because they have improved their readership, but also because the economic conditions have encouraged healthier advertising revenue.

1. Gawker properties.

Valuation: $240 million. The Gawker network of sites, controlled by founder Nick Denton, includes Gawker, Deadspin, Jezebel, Jalopnik, Gizomodo, Lifehacker, and several others. Gawker claims that its combined sites have just over 20 million unique visitors. Audience research firms do not give any reason to doubt those figures, and they actually seem to be low. The sites have about 235 million pageviews a month, and CPMs average $19 per page. This means the company’s revenue is $53.6 million. Gawker pays many writers based on their production and keeps relatively inexpensive office operations. The company’s flagship site only has a dozen or so writers and editors. Operating costs are about 55% of revenue. The content of the sites and their aggressive approach to topics would probably rule out many acquirers.

2. The Huffington Post.

Valuation: $150 million. The large news and information blog has more than 20 million and 24/7 estimates pageviews per month of 180 million. Attempts by the company’s new management and sales staff to raise the quality of the site have worked. Average CPMs on each page is up to $13. Huffington’s revenue for 2010 will be close to $28 million. The company, however, is very expensive to operate and has an extremely complex publishing platform. The firm has more than 150 employees and many additional editorial contributors, some of whom are paid. Huffington management said the company would make money this year, and 24/7 numbers project a very modest operating profit.

3. Drudge Report.

Valuation: $50 million. Drudge would be worth more but its value is highly dependent on the fate of founder Matt Drudge. The site’s unique visitors are higher than last year, up about 30% to 13 million. That may improve as the midterm elections near. Drudge posts its own figures for visitors on its homepage, but the numbers are ridiculously high. The quality of the site’s advertising has risen and CPM per page should be $6 this year. Based on 24/7 Wall St.’s pageview estimates, Drudge revenue in 2010 will be nearly $13 million. The company is very inexpensive to run, and our estimates put operating income at $6.5 million after sales costs are taken into account.

4. PopSugar Media.

Valuation: $40 million. The family of sites for young women has about 14 million unique visitors a month. Household income of the people who go to these sites is relatively low. The company is one of the more likely M&A targets on this list because it delivers a large audience, is only moderately dependent on its founders and is inexpensive to operate. PopSugar has more than 12 major branded sites, several of which target visitors outside the US. Our estimated CPM per page is $8. Revenue based on 24/7 Wall St. pageview estimates is $11.5 million. Sugar Inc. has full-time and part-time staff of close to 100. Operating profit is nearly $3 million.

5. MacRumors.

Valuation: $37 million. The leading site on all things Apple, this property has significantly improved the quality of its adverting from last year. The site has 7 million unique visitors. CPM per page is up to $10. Revenue is $9 million. The company has less than a dozen full-time employees and freelance writers. NetShelter Technology sells the site’s advertising inventory. Operating profit is $2.5 million.

6. Cheezburger Network.

Valuation: $35 million. A collection of sites best known for IcanhasCheezburger? The properties focus on oddball humor for the “X” and “Y” generations. The company also owns Fail Blog which is a collection of picture and videos of people in the midst of failing at things and of things that are themselves failures. The network has 11.8 million unique visitors and 110 million pageviews. The sites have a CPM per page of $8 and revenue of $10.5 million. The company is constantly starting new sites which it keeps or kills quickly based on traffic. Operating profit of $4 million.

7. Perez Hilton.

Valuation: $32 million. The celebrity news site, which is an increasingly crowded field dominated by large media companies, has 6 million unique visitors a month. Advertising is sold by the BlogAds network. CPMs remain low, as was true last year, but the number of premium ads is up and our CPM estimate per page is now $8. Revenue for the site is $5.4 million. Perez Hilton has an extremely small editorial staff and nearly no general and administrative costs. Operating income before what the owner takes out of the business is over $2.2 million. The site’s value is dependent to a large extent on its founder.

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