|Bwin.party Digital Entertainment
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Real-Time news about Bwin.Party (London Stock Exchange): 0 recent articles
Only Bpty management could be stupid enough to accept a lower offer! Unbelievable. This really does explain why bpty share price has been spiralling downwards for years. Management called it volume to value, I call it madness|
|blackrocktrader: Guys if you do not accept it where the bpty share price will be in one or two years time ????|
|cheshiremoggie: Hubshank 18 Jun'15 - 13:21 - 5409 of 5410 0 0
A while ago, when we thought we were going to get licensed in California, the broker value of BPTY share price rose by 70p per share (I couldn't tell you what the anticipated EPS was) but the target price did rise to £1.70 from £1.
Are you really basing your investment strategy on a broker target price? Broker predictions arent known for their reliability or even integrity.
Similarly forward looking forecasts....
|coxsmn: Mylands, agreed if the GVC Amaya offer is accepted it would be tremendous news for the BPTY share price and dividend. Lets hope management make the right decision this time!|
|mylands: From my post of this morning on the GVC thread:
In today's business of the Sunday Telegraph it says that the CEO of BWIN, Norbert Teufleberger, is in line for a £17 million plus payout if there is a takeover. Not bad when you have presided over the destruction of shareholder value, with the BPTY share price going from 200p when it merged with Party Gaming down to 80p ahead of the bid talk last November. In the same period GVC's share price has gone from 120p to 470p.
This is another example of shareholders paying for failure.
I should add that since April 2011, GVC have paid out 130p in dividends, whilst in the same period BPTY have paid out 14p and 888 24p. I know which company I would want to win the takeover battle if I were a BPTY shareholder.|
|stephan1946: The AGM on thurs will determine where this price goes, I anticipate a recommendation to accept 888 bid. BPTY share price £1.25p Thursday afternoon.
Fri will see a significantly increased offer by Amaya, which will be bettered by 888 on Tuesday following the bank holiday.
This is going to see BPTY holders patience, rightly rewarded.
Throughout all of this, remember, Amaya can not afford to lose.|
|mylands: Considering there are two 'bids' on the table, the muted repsonse from the BPTY share price is revealing IMO.
When BPTY put itself up for sale last November the price soared to 119p. That was without any bids. Yet now with two, the share price is 13p below that level. The market obviously doesn't think this is worth much more than its current mkt cap of £875 million.|
|loganair: Bwin.party Digital Entertainment: Don't Buy This Management Team by Vince Martin:
•BPTY management has - or should have - lost any faith investors might have had.
•Four-plus years of post-merger missteps have led the stock, deservedly, to all-time lows.
•Acquisition rumors are rampant, but any substantial premium seems unlikely.
•Until management is changed, or a smart asset sale conducted, BPTY is at best an 'avoid'.
“Management should be embarrassed by these results given the strong performance of Bwin's peers...The board as a collective, and its chairman are not holding management accountable for loss of market share, poor expense management, and business underperformance. The time for change at Bwin is long overdue."
The biggest concern at BPTY has been management as the company has seen huge swings in strategy, from an initial emphasis on scale, operating leverage, and international reach, to an ill-advised pullout from 'grey' markets (unregulated markets where the legality of online gambling is uncertain) and the aforementioned "'value' over 'volume' strategy. Plans to "simplify" the business have morphed into a new segmentation of reporting for the business.
It hasnt just been long-term strategy errors, but wasted spending and poor capital allocation. In 2012, the company announced a €50 million investment in a social gaming unit called Win Interactive; after millions more in losses (including €13 million combined in 2013 and 2014, per the 2014 annual report), the unit is to be divested. Only a few months earlier, Caesars Entertainment - hardly a model of operational efficiency of late - had purchased Playtika for $108 million to create the core of its Caesars Interactive unit. It is now the dominant provider of social casino games, and one of the most valuable assets in CZR's shell game with creditors. Meanwhile, BPTY CFO Martin Weigold said on the Q4 conference call that bwin.party had sold Win Interactive ("we're expecting to sign that today") but as yet, no agreement has been announced. Either Weigold was being over-optimistic - or the Win sale is immaterial to BPTY's financial condition.
There's more. A much-hyped partnership with Zynga in the UK put the entire financial responsibility on bwin.party - including development of Farmville-branded online slots. "Today's announcement is another example of our success in leveraging our assets through strategic blue-chip partners," said Teufelberger in the release. (The use of "another" is curious; having followed BPTY for years, I honestly cannot name any examples of that success, or a single "blue-chip" partnership.) "(We) hope to expand our relationship into other products and markets," the CEO added. Zynga quietly shut the partnership down last month. Revenue from the deal was apparently immaterial, as it was never mentioned in financial reports from either company.
The point of rehashing this history is simple: investors cannot trust bwin.party management, and in particular CEO Teufelberger. There have been too many broken promises, too many results that missed guidance, too large a decline in the share price - and little or no reckoning from the company or its leader. There is good reason BPTY is near all-time lows - it's been run into the ground. And yet - after four years of losses - Teufelberger cheerfully announces after FY14 results that the company is "improving its operational effectiveness and customer focus." One wonders what bwin.party, and Teufelberger, have been doing for the last four years, if not aiming for effectiveness and focusing on customers.
The Acquisition Rumors:
Acquisition rumors of part or all of bwin.party have swirled since at least last June, when Bloomberg reported the company was undergoing a strategic review. That was in the wake of an activist effort by Jason Ader, who had taken on slot machine giant International Gaming Technology in 2012. Since then, BPTY shares have been trading in large part on acquisition hopes, rising after Teufelberger admitted following Q2 results that the company might need to look to "alternative financing and corporate structures", and again when Amaya Gaming, owner of PokerStars, was rumored to have interest in adding bwin.party to its stable. Shares whipsawed in February after reports that potential bidders had walked away, followed by claims that Amaya was indeed still interested. Following the Q4 results in March, new chairman Philip Yea told the Financial Times the company was in "further discussions" with several groups, adding "we're testing them against each other and business as usual."
There's a real question whether BPTY can sell itself, whether in whole or in pieces. No one wants the poker business, which is headed for collapse:
Poker revenue was down another 30% in the first 8 weeks of 2015, and with PokerStars reportedly entering the New Jersey market later this year, thoughts of a US-facing spinoff are likely doomed. (bwin.party is already hemorrhaging money in the state to begin with.)
The company has long skirted the edges of the law in Germany, and enforcement of new regulations there (20 licenses are being distributed, and bwin.party is not one of the recipients) could impact - or remove - 25% of BPTY's total revenue. A new 15% "point of consumption" tax in the UK hurts profits in that market, which is largely saturated to begin with. The Kalixa payment business may be spun off with an IPO later this year, per the Q4 conference call, but with €35-€40 million in targeted '15 revenue, it won't provide a lucrative payday to BPTY shareholders.
The rest of the company is either declining, losing money, or both, with the notable exception of Foxy Bingo. With €12 million trailing adjusted EBITDA, and the launch of Foxy Casino, that segment could see a takeout price in the range of $200 million. Add in $50 million for non-core businesses, and $100 million for Kalixa, and bwin might be able to generate $400 million or so - still less than half its market cap.
Beyond that, it's hard to see what the point of a BPTY acquisition might be. Its B2B offering isn't ready to compete with 888 Holdings) Dragonfish, or long-established Playtech. Its mobile technology is lagging (while bwin targets 50% penetration by year-end - hopefully - Paddy Power is already at 55%, per its annual report). Its sports betting business could get hammered by a forced retreat from Germany. Meanwhile, buying BPTY would require extensive upfront costs, for everything from licensing costs to severance.
And it's not like BPTY is cheap. On a trailing EBITDA basis, its EV/EBITDA multiple is about 9x; on a forward basis, it's no doubt above 10x. Compare that to ~12x at 888, which has cemented itself as a clear number two in the poker vertical and is posting growth in all segments and across a number of geographies. BPTY's trailing adjusted P/E is about 15x, compared to 10x at similarly struggling Ladbrokes, which also offers a much higher dividend yield.
Acquiring BPTY simply isn't an easy sell. If an acquisition - whether as a whole or in part - doesn't materialize, BPTY shares will plummet; if it does, in either case it's hard to see a buyer surprising the market with a powerful offer at this point. If an attractive offer were on the table, it's likely BPTY would have moved on it by now, some ten months after it first started looking at strategic options. And there simply isn't a compelling enough asset in the BPTY business to drive any sort of substantial premium.
A purchased BPTY offers minimal upside; a standalone BPTY could still have further to fall. With the London share price around 80 pence, after a long decline, it's easy to forget that bwin.party still has a market cap over US$1 billion. The 'bottom' for BPTY could still be years away.
That said, with acquisition rumors still swirling, a short sale in the near term probably doesn't make much sense, if only because of the potential for rumors to cause double-digit gains from current levels. But any sort of long position doesn't make any sense at all. Until significant changes come to bwin.party - either its management or its business - the long, hard post-merger fall will likely continue.|
|stephan1946: Sorry hubshank, like most things connected to the online industry it`s mostly guesstimates, rather like the $bn figures for the whole gaming industry that proved to be unrealistic.
I think the way forward is about to be revealed judging by the floor that seems to have been put under the bpty share price over the past 5 days. Plus, the bad actor clause is being raised again by the tribe`s, maybe Amaya knew it would come and, (Frankie and spactive said it first)bpty with a license is just days away from a deal.|
|srpactive: Bpty share price has crossed and closed above the 50day ma,
which is very positive, a challenge of the 200dma at 95p
would be good.|
Bwin.party Digital Entertainment share price data is direct from the London Stock Exchange