Chelsea have been ranked as the seventh most valuable club in Europe according to KPMG’s fifth annual report.

The global tax, audit and advisory services firm have released their annual report, which covers the top 50 football clubs in Europe based on operating revenues and UEFA coefficients.

They calculate each club’s “enterprise value” which indicates what the club is worth regardless of capital structures used to finance its operations.

KPMG took into account several variables including each club’s profitability, popularity, sporting potential and broadcasting rights.

And according to their study, Chelsea are ranked seventh in Europe and fourth in England with a valuation of £1.8billion.

The Blues, however, have seen a decrease (£127m or 6.3%) in their valuation compared to last year.

Manchester United (valued at £2.8bn) top the Premier League list and are ranked second in Europe. While La Liga giants Real Madrid (£2.95bn) and Barcelona (£2.7bn) are first and third on the list, respectively.

The current Premier League leaders Liverpool have had a significant spike in their valuation (£2.2bn, +19.3%) and leapfrogged Manchester City (£2.2bn, -0.3%) and Chelsea into fifth place in Europe.

(Photo by Mike Hewitt/Getty Images)

Here are the 10 most valuable clubs in Europe according to KPMG:

1. Real Madrid (unchanged) – £2.95bn (+1.5%)

2. Manchester United (unchanged) – £2.84bn (-2%)

3. Barcelona (+1) – £2.71bn (+12.2%)

4. Bayern Munich (-1) – £2.44bn (+0.4%)

5. Liverpool (+2) – £2.26bn (+19.3%)

6. Manchester City (-1) – £2.21bn (-0.3%)

7. Chelsea (-1) – £1.88bn (-6.3%)

8. Tottenham Hotspur (+1) – £1.75bn (+15.8%)

9. Paris Saint-Germain (+2) – £1.62bn (+36.7%)

10. Arsenal (-2) – £1.57bn (-13.2%)

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