Macquarie analyst Chad Beynon has maintained their bullish stance on GENI stock, giving a Buy rating today.
Chad Beynon has given his Buy rating due to a combination of factors involving Genius Sports Limited’s performance and expected growth. The sports technology company, with a market capitalization of $1.5 billion, exhibited a strong fourth quarter, with revenues and EBITDA surpassing consensus estimates by 1% and 7%, respectively. The company demonstrated significant year-over-year growth, driving revenues to $127 million, a 21% increase, while EBITDA jumped to $12 million, a 349% increase. This performance underscores the company’s robust operating leverage, and management’s guidance for 2024 suggests continued momentum, forecasting a 16% and 42% year-over-year growth in revenues and EBITDA, respectively. Furthermore, positive free cash flow is anticipated for 2024.
In addition to the strong financials, Beynon’s optimism is fueled by the broader industry trends that bode well for Genius Sports. The ongoing legalization of sports betting, coupled with a swift shift toward live betting, underpinned by innovative products like BetVision, are key drivers for the company’s growth. The in-play betting segment, which showed a significant margin improvement during the NFL season, remains ripe for expansion. The company operates in a quasi-duopoly market with a large total addressable market (TAM), suggesting a potential to outperform the general market and realize considerable operating leverage. Beynon’s valuation relies on a balanced approach, incorporating EV/EBITDA, FCF, DCF, and EV/sales metrics, with an $11 target price reflecting these growth expectations and industry catalysts.
In another report released today, Oppenheimer also maintained a Buy rating on the stock with a $10.00 price target.
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Genius Sports Limited (GENI) Company Description:
dMY Technology Group Inc II is a blank check company.
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