This report is not a personal recommendation and does not take into account your personal circumstances or appetite for risk.
Trade Parameters
Observations – For
Observations – Against
Shares found support after recent sell-off. Positive changes to US regulation on sports betting could represent big growth, especially after merging with US operator FanDuel. A lower than expected Australian point-of-consumption tax could benefit revenues. A busy summer of sport (World Cup, Wimbledon, Ryder Cup) should boost business. Consolidation in gambling sector always a possibility (GVC bough Ladbrokes Coral).
New UK laws on Fixed Odds Betting terminals will result in lost revenues, as will the UK government raising duty on remote gambling to help cover the shortfall. Any new laws/regulatory pressure is always a risk. A disappointing trading update in August could hurt the share price. Interest rate hikes reduce disposable income.
Broker consensus is slightly bearish on account of 40% of analysts suggesting Sell, however, putting all the Buyers and Neutrals together still implies 60% of brokers being positive on the shares, seeing potential for them to rise, or hold their value at the very least. While the consensus target of 7870p implies downside of 5% for the shares, broker price targets are split 46/54% in terms of upside/downside, which may require updating/upward revisions.
Next Event: Interim Results announcement, Aug; Ex-div, late Aug
Latest Broker 12-Month Consensus: 30% Buy, 30% Hold, 40% Sell (full breakdown on request)
Source: DowJones Newswires, Reuters News, Bloomberg or Company Press releases
| Share | 1wk | 1m | 3m | 6m | 1yr | 2yr | 3yr | 4yr | 5yr |
| Perf % | 0.3 | -4.0 | 11.8 | -4.9 | -5.0 | -8.8 | 46.8 | 111.2 | 48.2 |
This research is produced by Accendo Markets Limited. Research produced and disseminated by Accendo Markets is classified as non-independent research, and is therefore a marketing communication. This investment research has not been prepared in accordance with legal requirements designed to promote its independence and it is not subject to the prohibition on dealing ahead of the dissemination of investment research. This research does not constitute a personal recommendation or offer to enter into a transaction or an investment, and is produced and distributed for information purposes only.
Accendo Markets considers opinions and information contained within the research to be valid when published, and gives no warranty as to the investments referred to in this material. The income from the investments referred to may go down as well as up, and investors may realise losses on investments. The past performance of a particular investment is not necessarily a guide to its future performance.
Prepared by Michael van Dulken, Head of Research