32red Share Discussion Threads

[panic investor] 08/8/2016 12:51

yes the share price has history of that, it once fell from over 100 to 70p in one hour, I contacted the CEO, he issued an rns later that day.

[glaws2] 08/8/2016 12:34

The share has a history of making large downside moves for no obvious reason. So far it has always recovered.

[shaker44] 08/8/2016 11:47

tempting but I would like to understand why it fell gently out of bed on Friday-a market up day?

[nw99] 08/8/2016 11:10

Buying this dip

[shaker44] 03/8/2016 12:26

I guess the board will be considering the unique position of Gibraltar and its future, and the frequent 'handbags' spats between UK and Spanish governments- such as they are. Fortunately Spain has had its hands full trying to form a government for a while, and to fight off independence for Catalonia. (Spain seems to see no contradiction between their complaints of UK owning an island joined to Spain, and their own spanish cities of Melilla and Cueta inside Morocco!!) But I digresss...

It would be surprising if all the companies based in Gib for tax reasons did not have a Plan B, looking at several other locations offering similar tax privileges...

Seems to me that growth and margin are far bigger issues to focus upon. acquisition cost per new customer, net revenue per customer etc .

[paleje] 03/8/2016 11:56

Yes you'd think so shaker. I mailed EW on the weekend about Brexit, he came back yesterday said there's nothing at the mo causing them worries in that respect but obviously it's still an unfolding story. Currency won't have much effect because only a small proportion of revenue not in sterling.

[shaker44] 02/8/2016 13:01

I suspect ST speaks to Ed Ware by Phone before writing his column so knows a little more than just Revenue growth! Hope his expectation of getting back up to 186 p is right!

[paleje] 02/8/2016 12:19

ST has a column on these this morning, I can't paste the lot but his conclusion is here:-

....In fact, the rating is even more attractive because the year-end net cash balance is expected to rise by a quarter to £12.9m, a sum worth 15p a share. This means that 32Red's shares are trading on a cash-adjusted PE ratio of less than 11 for 2016, hardly a punchy rating for a business thriving in the post-Point of Consumption (PoC) gaming market, winning customers from operators unable to compete in the more onerous tax environment, and with potential to continue to grow at market-leading rates. Indeed, by more effectively target marketing customers, 32Red is achieving high returns on its marketing spend, while also benefiting from reduced competition as uneconomic operators exit the market. A sponsorship deal with Leeds United for the 2016/17 football season, and the return of 32Red sponsored Glasgow Rangers to the Scottish Premier League, can only help develop the brand.

In the circumstances, I would recommend running your healthy profits with 32Red's shares trading on a bid-offer spread of 134p to 135p, targeting a move back towards the March 2016 all-time high of 186p. Run profits.

[paleje] 01/8/2016 09:25

I think you're right Nurdin. If you take Roxy out of the numbers, their LFL growth rate is actually accelerating, 22% in 2015 to 32% now. Roxy was estimated to make up 40% of 2016 cash profits, can't really say much about that till Sept as Shaker says but on management track record and that update I don't feel uncomfortable at all. And activity since end June is up too, all bodes well at this stage, might get a piece from ST this week he follows these.

[shaker44] 01/8/2016 09:13

Very poor response from the market today. i still think no mention of profit or margin was a big mistake. 'Revenue for Vanity, Profit for Sanity' etc etc

[shaker44] 01/8/2016 09:05

Really. 8.4m. Well, if net revenues 1H 2016 were 5.8m that looks pretty good- depending on what overhead came with it and how much synergy they could wring out. Wont know more until Sept I suppose.

[nurdin] 01/8/2016 09:03

Up with events? These guys are having a laugh surely? The stock is trading at just 8.7x forecast 2017 earnings with a peg of just 0.3.Still grossly undervalued Id say.

[paleje] 01/8/2016 08:55

Think they paid 8.4m for Roxy.

[shaker44] 01/8/2016 07:23

Thanks for posting that. very interesting. Without more evidence they seem to be up with events. Anyone know what they paid for the Roxy palace acquisition?

[paleje] 01/8/2016 00:23

A view from shareprophets on TTR but it doesn't actually concluded anything except it's uncertain whether they can keep it up:-

32Red (TTR), the online gaming business, delivered a nice set of results on Friday, although they were greeted in a lacklustre fashion by the market. After a huge run up in price over the past year, investors seem cautious that the share price might now fully “up with events”.

Licensed in Gibraltar (where else?), 32Red offers the online casino experience you’d expect: slots, roulette, blackjack, poker and a variety of other games. They have a sports-dedicated site amongst a variety of sister sites.

The latest results show 32% organic revenue growth, or 63% growth if you include the contribution of last year’s acquisition of a rival casino.

(Note that “Revenue” in the gaming industry refers to Net Gaming Revenue: that’s wagers minus pay-outs minus bonuses and some other standard items.)

One of the major problems facing gaming in recent years has been the UK’s Point of Consumption Tax – as with many taxes and regulations, this has the effect of driving smaller and newer competitors out of business, while empowering more established enterprises.

Fortunately for 32 Red, it was large enough to withstand the effects of the POC and decided to use the opportunity to seize market share.

Last year, it increased net gaming revenues by 52% against 2014.

The momentum has clearly continued in the first six months of 2016.

The problem is the market cap of £115 million, putting a fairly high rating on can often turn out be a commoditised product.

Online gaming is a highly competitive space, and especially in the casino business where many products can be replicated by developer teams at rival firms. While those with existing scale have an advantage, the competitive dynamics seem to revolve mostly around to the marketing budget.

32% revenue growth should translate into a healthy profit figure but I’d suggest that this stock is primarily for gaming aficionados – i.e. those who can figure out whether 32Red’s competitive advantage is here to stay. The healthy balance sheet, cash flow and dividend may also attract some value investors. I’ll keep a watching brief on these shares for now.

- See more at: (TTR), the online gaming business, delivered a nice set of results on Friday, although they were greeted in a lacklustre fashion by the market. After a huge run up in price over the past year, investors seem cautious that the share price might now fully “up with events”.

Licensed in Gibraltar (where else?), 32Red offers the online casino experience you’d expect: slots, roulette, blackjack, poker and a variety of other games. They have a sports-dedicated site amongst a variety of sister sites.

The latest results show 32% organic revenue growth, or 63% growth if you include the contribution of last year’s acquisition of a rival casino.

(Note that “Revenue” in the gaming industry refers to Net Gaming Revenue: that’s wagers minus pay-outs minus bonuses and some other standard items.)

One of the major problems facing gaming in recent years has been the UK’s Point of Consumption Tax – as with many taxes and regulations, this has the effect of driving smaller and newer competitors out of business, while empowering more established enterprises.

Fortunately for 32 Red, it was large enough to withstand the effects of the POC and decided to use the opportunity to seize market share.

Last year, it increased net gaming revenues by 52% against 2014.

The momentum has clearly continued in the first six months of 2016.

The problem is the market cap of £115 million, putting a fairly high rating on can often turn out be a commoditised product.

Online gaming is a highly competitive space, and especially in the casino business where many products can be replicated by developer teams at rival firms. While those with existing scale have an advantage, the competitive dynamics seem to revolve mostly around to the marketing budget.

32% revenue growth should translate into a healthy profit figure but I’d suggest that this stock is primarily for gaming aficionados – i.e. those who can figure out whether 32Red’s competitive advantage is here to stay. The healthy balance sheet, cash flow and dividend may also attract some value investors. I’ll keep a watching brief on these shares for now.

- See more at:

[panic investor] 30/7/2016 16:04

Punter fatigue - I know the feeling some days looking at the stock screens !

[mudbath] 30/7/2016 15:44

Increasing competition added to pressure on discretionary spending allied to punter fatigue all make for lessening momentum.
imo.

[paleje] 29/7/2016 17:57

They did qualify in the breakdown very clearly that 5.8m came from Roxy Palace which made no contribution the previous year, they also clearly stated LFL numbers. It didn't seem sneaky to me, if it has caused some to sell then they may regret it in September. We'll see, have a good weekend, it's only a matter of opinion.

[pyemckay] 29/7/2016 17:45

on top of the reported growth they need to grow another 17% from first half just to achieve the forecast turnover. There must be doubts if that can be achieved. Defo risks are to the downside imvho.

[shaker44] 29/7/2016 16:49

Clearly claiming 63% growth when over 30% of that was solely due to a new acquisition is hyping! I dont need to look back to know that a serious compoany informing existing and prospective sgareholders in a trading update should reference profit. In answer to the 'why did they drop' question above, I have not seen a better explanation but I would be very hapopy to read one.

[paleje] 29/7/2016 16:35

They don't comment on margins in their trading statements, Shaker44, look back. There's no point in them hyping things up, what's in it for them? They're good management with an excellent track record, the interims in a few weeks will dispel doubts or not, we'll have to wait but I don't see anything odd in their presentation today.

The only thing I would have liked would have been a brexit view particularly where they're situate, they may think it's not worth a mention but most boards are commenting on it when issuing relevant RNS's. Investors like reassurance but historically good though they are, commuication has never been a strong point here. Just imo.

[shaker44] 29/7/2016 16:16

I think the drop is entirely due to the results presentation. Hyped up the revenue growth by claiming 63% even though a large part of that was an acquistion which figured in this year and not last so a false comparison.

But mostly as NO comment on margin or profits. The no comment naturally leads to a conclusion that they were disappointing hence the focus on the hyped growth in revenues.

The BoD trying to be clever and assuming investors are less smart than them maybe?

When they know all investors care about profit not t/o it looks pretty naive to me. And many investors will not take much comfort from Numis TP of 200p.

[tines] 29/7/2016 15:22

agreed. why the drop? do you think as the sector is consolidating, its a tree shake as its a prime t/o target?

[nurdin] 29/7/2016 14:35

Crazy market response to what are excellent results! Good job they didnt record a loss!

[paleje] 29/7/2016 13:30

Numis reiterated their 200p buy advice this morning.
They wouldn't upgrade on a trading statement, 21 Sept numbers.