Shares of sports activities betting information supplier Genius Sports activities (NYSE: GENI) are larger by almost 57% year-to-date. On Could 26, they closed on the highest ranges since February. A sell-side analyst believes the inventory has extra upside forward.
Genius Sports activities seems on the screens of the NYSE after it went public. An analyst says the inventory can ship extra upside. (Picture: Genius Sports activities)
In a latest be aware to purchasers, Lake Avenue Capital markets analyst Eric Martinuzzi initiated protection of Genius Sports activities with a “purchase” ranking and a $7 worth goal. That suggests upside of 25% from the Could 26 shut. That’s barely beneath the Wall Avenue consensus of $7.50. However Martinuzzi is now certainly one of 9 analysts masking Genius with a “purchase” or “robust purchase” ranking. One other calls the inventory a “maintain.”
The analyst described Genius as a “picks and shovels participant” that markets reside betting information and “different sticky companies” to international sportsbook operators, together with Bet365 and DraftKings (NASDAQ: DKNG), amongst others. Some analysts consider the inventory may benefit from bettors’ growing choice for in-game or reside wagers over pregame investments.
That thesis might additional be enhanced by same-game parlays — bets operators corresponding to DraftKings and FanDuel are leveraging to vital success.
Genius ‘Child’ Thrown Out with ‘SPACwater’
London-based Genius Sports activities went public in April 2021 following a reverse merger with particular goal acquisition firm (SPAC) dMY Expertise Group, Inc. II. The inventory caught a number of the tail finish of buyers’ enthusiasm for SPAC and sports activities betting shares, however slumped final yr, as market contributors punished equities beforehand tied to blank-check corporations.
At one level in 2021, Genius traded north of $24, and Martinuzzi describes the next tumble skilled by the inventory as a case of the “Genius child being thrown out with the SPACwater.”
Genius is on the cusp of turning free money move optimistic and is rising quicker than its higher-valued friends,” wrote the Lake Capital analyst. “We additionally really feel it has higher rights relationships — NFL, English Premier League — and affords quicker revenue progress than information licensing competitor Sportradar. We anticipate Genius displaying elementary outperformance pushed by a decade-plus progress in U.S. sports activities betting as extra states legalize on-line playing.”
Genius hovering round profitability and producing free money move are noteworthy traits, if for no different purpose than that they’re uncommon within the universe of sports activities betting equities.
Genius Sports activities Spectacular Consumer Roster
Martinuzzi is true to say Genius Sports activities’ shopper portfolio — a roster that features not solely the English Premier League and the NFL, however the PGA Tour, Main League Baseball (MLB), the NCAA and Euroleague Basketball, amongst others.
Along with the NFL itself, which can also be a serious Genius shareholder, a number of of the league’s groups are Genius purchasers, as are a number of the greatest names in sports activities broadcasting, together with ESPN.
Past Bet365 and DraftKings, Genius’s different sprotsbook purchasers embody 888 Sports activities, BetMGM, and Caesars, in response to the info supplier’s web site.
