Latest news with #EntainPlc
Bloomberg
2 days ago
- Business
- Bloomberg
Entain Shares Rise After Gambling Group Upgrades BetMGM Guidance
Entain Plc shares rose as much as 8% after the sports betting and gaming group upgraded its full-year revenue guidance for BetMGM, the US-based joint venture it shares with MGM Resorts International. BetMGM is expected to deliver net revenue for 2025 of at least $2.6 billion, compared to a previous forecast of $2.4 billion to $2.5 billion, Entain said in a trading update on Monday. The company said the 'positive momentum' seen in the first quarter for online gambling has continued as customers placed more bets.
Yahoo
06-03-2025
- Business
- Yahoo
Investors in Entain (LON:ENT) have unfortunately lost 48% over the last three years
As an investor its worth striving to ensure your overall portfolio beats the market average. But in any portfolio, there are likely to be some stocks that fall short of that benchmark. Unfortunately, that's been the case for longer term Entain Plc (LON:ENT) shareholders, since the share price is down 50% in the last three years, falling well short of the market return of around 24%. It's worthwhile assessing if the company's economics have been moving in lockstep with these underwhelming shareholder returns, or if there is some disparity between the two. So let's do just that. Check out our latest analysis for Entain In his essay The Superinvestors of Graham-and-Doddsville Warren Buffett described how share prices do not always rationally reflect the value of a business. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS). We know that Entain has been profitable in the past. However, it made a loss in the last twelve months, suggesting profit may be an unreliable metric at this stage. Other metrics might give us a better handle on how its value is changing over time. Revenue is actually up 9.7% over the three years, so the share price drop doesn't seem to hinge on revenue, either. It's probably worth investigating Entain further; while we may be missing something on this analysis, there might also be an opportunity. The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers). We consider it positive that insiders have made significant purchases in the last year. Having said that, most people consider earnings and revenue growth trends to be a more meaningful guide to the business. This free report showing analyst forecasts should help you form a view on Entain As well as measuring the share price return, investors should also consider the total shareholder return (TSR). The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. As it happens, Entain's TSR for the last 3 years was -48%, which exceeds the share price return mentioned earlier. And there's no prize for guessing that the dividend payments largely explain the divergence! Investors in Entain had a tough year, with a total loss of 8.2% (including dividends), against a market gain of about 15%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Longer term investors wouldn't be so upset, since they would have made 4%, each year, over five years. If the fundamental data continues to indicate long term sustainable growth, the current sell-off could be an opportunity worth considering. It's always interesting to track share price performance over the longer term. But to understand Entain better, we need to consider many other factors. Even so, be aware that Entain is showing 1 warning sign in our investment analysis , you should know about... If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: most of them are flying under the radar). Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on British exchanges. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Sign in to access your portfolio
Bloomberg
11-02-2025
- Business
- Bloomberg
Entain CEO Steps Down From Gambling Firm With Immediate Effect
British sports betting company Entain Plc 's Chief Executive Officer Gavin Isaacs has stepped down with immediate effect after less than six months in the role. Isaacs is leaving the company by 'mutual agreement,' Entain said in a statement on Tuesday. Stella David, who was interim CEO prior to Isaacs, will re-assume the position.
Yahoo
06-02-2025
- Business
- Yahoo
An Intrinsic Calculation For Entain Plc (LON:ENT) Suggests It's 49% Undervalued
Using the 2 Stage Free Cash Flow to Equity, Entain fair value estimate is UK£14.55 Entain is estimated to be 49% undervalued based on current share price of UK£7.36 The UK£9.58 analyst price target for ENT is 34% less than our estimate of fair value Today we'll do a simple run through of a valuation method used to estimate the attractiveness of Entain Plc (LON:ENT) as an investment opportunity by taking the forecast future cash flows of the company and discounting them back to today's value. Our analysis will employ the Discounted Cash Flow (DCF) model. Models like these may appear beyond the comprehension of a lay person, but they're fairly easy to follow. We would caution that there are many ways of valuing a company and, like the DCF, each technique has advantages and disadvantages in certain scenarios. Anyone interested in learning a bit more about intrinsic value should have a read of the Simply Wall St analysis model. Check out our latest analysis for Entain We are going to use a two-stage DCF model, which, as the name states, takes into account two stages of growth. The first stage is generally a higher growth period which levels off heading towards the terminal value, captured in the second 'steady growth' period. To begin with, we have to get estimates of the next ten years of cash flows. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years. Generally we assume that a dollar today is more valuable than a dollar in the future, and so the sum of these future cash flows is then discounted to today's value: 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 Levered FCF (£, Millions) UK£361.2m UK£402.0m UK£577.0m UK£649.0m UK£702.1m UK£746.8m UK£784.7m UK£817.6m UK£846.8m UK£873.3m Growth Rate Estimate Source Analyst x3 Analyst x4 Analyst x1 Analyst x1 Est @ 8.18% Est @ 6.36% Est @ 5.08% Est @ 4.19% Est @ 3.57% Est @ 3.13% Present Value (£, Millions) Discounted @ 9.2% UK£331 UK£337 UK£444 UK£457 UK£453 UK£441 UK£425 UK£405 UK£385 UK£363 ("Est" = FCF growth rate estimated by Simply Wall St)Present Value of 10-year Cash Flow (PVCF) = UK£4.0b We now need to calculate the Terminal Value, which accounts for all the future cash flows after this ten year period. For a number of reasons a very conservative growth rate is used that cannot exceed that of a country's GDP growth. In this case we have used the 5-year average of the 10-year government bond yield (2.1%) to estimate future growth. In the same way as with the 10-year 'growth' period, we discount future cash flows to today's value, using a cost of equity of 9.2%. Terminal Value (TV)= FCF2034 × (1 + g) ÷ (r – g) = UK£873m× (1 + 2.1%) ÷ (9.2%– 2.1%) = UK£13b Present Value of Terminal Value (PVTV)= TV / (1 + r)10= UK£13b÷ ( 1 + 9.2%)10= UK£5.3b The total value, or equity value, is then the sum of the present value of the future cash flows, which in this case is UK£9.3b. To get the intrinsic value per share, we divide this by the total number of shares outstanding. Relative to the current share price of UK£7.4, the company appears quite undervalued at a 49% discount to where the stock price trades currently. The assumptions in any calculation have a big impact on the valuation, so it is better to view this as a rough estimate, not precise down to the last cent. We would point out that the most important inputs to a discounted cash flow are the discount rate and of course the actual cash flows. If you don't agree with these result, have a go at the calculation yourself and play with the assumptions. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at Entain as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt. In this calculation we've used 9.2%, which is based on a levered beta of 1.712. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business. Strength No major strengths identified for ENT. Weakness Interest payments on debt are not well covered. Dividend is low compared to the top 25% of dividend payers in the Hospitality market. Opportunity Forecast to reduce losses next year. Has sufficient cash runway for more than 3 years based on current free cash flows. Good value based on P/S ratio and estimated fair value. Threat Debt is not well covered by operating cash flow. Dividends are not covered by cash flow. Valuation is only one side of the coin in terms of building your investment thesis, and it shouldn't be the only metric you look at when researching a company. DCF models are not the be-all and end-all of investment valuation. Rather it should be seen as a guide to "what assumptions need to be true for this stock to be under/overvalued?" For example, changes in the company's cost of equity or the risk free rate can significantly impact the valuation. Can we work out why the company is trading at a discount to intrinsic value? For Entain, we've compiled three further aspects you should assess: Risks: For example, we've discovered 1 warning sign for Entain that you should be aware of before investing here. Future Earnings: How does ENT's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with our free analyst growth expectation chart. Other High Quality Alternatives: Do you like a good all-rounder? Explore our interactive list of high quality stocks to get an idea of what else is out there you may be missing! PS. The Simply Wall St app conducts a discounted cash flow valuation for every stock on the LSE every day. If you want to find the calculation for other stocks just search here. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Sign in to access your portfolio
