Gvc Share Discussion Threads

[noujay] 21/8/2018 13:26

Sounds about right. Interesting note there - very much looking forward to the results and see a proper marker for where things are with the lads merger.

[nurdin] 21/8/2018 10:25

Estimated Target Return?

[t 34] 20/8/2018 19:35

ETR ??? Thanks .

[noujay] 20/8/2018 18:08

Many thanks Jeff

[jeff h] 20/8/2018 17:49

Citigroup view:-

GVC (GVC.L)

Strong growth forecast, US opportunity underpinned by JV, and valuation attractive; Buy

US sports betting could drive earnings in the medium term

We believe the opening up of the US sports betting market, on a state by state basis, could add c.6%-20% to GVC’s PBT long term (assuming it can achieve a 10% market share). We believe GVC’s 50:50 JV with MGM (announced July 30, 2018) should provide it with significant market access, brand presence and investment to exploit this opportunity. We would encourage some investor caution given: the early stage of the market, its fragmented nature (by state), likely high levels of competition and varying approaches to licensing, partnerships, channel etc. However, we believe US sports betting could be a $5b-$17b pa revenue (GGR) opportunity nationally

UK Online 14% CAGR 2018-20E

The UK online market is relatively mature, but we still believe a 9% CAGR in revenues is possible over next 3 years. We expect online penetration to increase from 60% in 2017 to 71% by 2020E, with upcoming retail regulation accelerating the pace of this shift. We expect GVC to take 0.7pp of market share a year (from 13.4% in 2017 to 15.4% in 2020E), leading to a 14% UK online revenue CAGR 2018-20E.

UK retail EBIT to decline 81% driven by regulation

We expect GVC’s UK retail EBIT to decline 81% in 2020 vs. 2017 as a result of the UK government’s decision to cut stakes on machines in betting shops from £100 to £2. UK retail EBIT is 30% of the group in 2017, and so has a c.24% impact on group EBIT.

Valuation - Buy with a target price of £15.5

We are Buy rated with 37% ETR to our TP of £15.5, up from £11.40 due to a change in our valuation methodology (previously SOTP, now combination of DCF and SOTP) and estimate changes (reflecting regulatory and taxation changes, recent M&A and synergies and current trading).GVC’s 2019E EV/EBITDA of 10.2x is attractive vs 15% EBITDA CAGR (2018-22E, excl. retail). We derive our TP using the average of two approaches: an SOTP (£13.4/share), and a DCF (£17.6/share). Our target multiples in our SOTP are based on the historical relationship between average peer multiples (EV/EBITDA) and forward growth expectations, applied to 2019E estimates (excl. retail where we use 2020E multiples, given new regulation).

[noujay] 20/8/2018 13:32

Almost as soon as written some pretty large trades appear!

[noujay] 20/8/2018 12:07

Seems to me there must be quite a lot of positioning going on I the background here behind the listed trades - for a start the capital group doubling their stake certainly doesn't tie in with the volumes appearing here this past couple of weeks.Now it's in the 100 does anybody have any comments as to the timescale upon which trackers and the like necessarily have to buy in, ie is it the case that it must retain its position for a period before they do? Obviously the 250 trackers will sell out although presumably many companies will have both in which case they will transfer their holdings from one into the other. Not an area I have any real familiarity with so any commentary very welcome.

[mylands] 20/8/2018 09:50

Selling pressure continues. Market up and we are down.

[fizzypop] 18/8/2018 11:12

Interims due Thurs 13 Sept.

[burn248] 18/8/2018 10:12

When are the results due anyone?

[nurdin] 17/8/2018 14:40

Interesting and informative site giving a nice graphical overview of the state of online gambling in the USA ...while we are biding our time!

[sogoesit] 17/8/2018 10:47

The trend share price growth is running at a compound 30%+ per annum.
The year-on-year growth to 1100p has been 51% approx. excluding dividends.

What's not to like?

For anyone wanting to do their returns calculations GVC have a handy little calculator on their site:

[noujay] 16/8/2018 14:26

Well they aren't in to trade it that's for sure so they obviously like the story for the long term

[nurdin] 16/8/2018 14:05

Its a huge financial services company with $1.7 trillion worth of assets under management.US funds getting very interested here,I am sure more will follow.

[noujay] 16/8/2018 13:58

And just two hours after my post mentioned them, there they go increasing their stake again!

[noujay] 16/8/2018 11:39

Yes me too. Good post World Cup trading update, capital group double up their stake end of July, serious deal of intent for the US market, and it's just sat drifting downwards. Perhaps the forthcoming results with dividend clarity and a fuller update on post merger plans will stabilise it a bit.It did in fairness have a good rise from May but nonetheless I expected it to be trading higher than it currently is

[nurdin] 16/8/2018 11:14

I am really surprised at this decline given the recent deal.

[noujay] 16/8/2018 10:57

Given them plenty more time to mitigate the future loss of revenues whilst concurrently growing the existing online stuff and achieving the synergies

[nurdin] 16/8/2018 08:59

.FOBT limit of £2 doesnt come into force until April 2020...didnt know that. Dont know if that estimate still holds

[noujay] 15/8/2018 12:54

More terrific performance today! It's getting slightly predictable but I remain surprised by the lacklustre nature of the trading despite it being August! Roll on the results

[kexicus] 14/8/2018 11:43

Glad to be back into GVC today after paying a bit off to the mortgage. Always been a good share for the wife and I this one. Small holding that I hope to build on as time goes on.

[mylands] 14/8/2018 09:12

JPJ, another boom stock, is reacting badly to its results out this morning and PLUS500 are now down 20% from its high ahead of yesterday's results.

[melody9999] 13/8/2018 23:03

the share price was 1100p before the MGM RNS so the current share price is discounting any value from this initiative.

[oohrogerpalmer] 13/8/2018 18:31

Think people got excited when the tie up with MGM was announced when reality is that its a long-term project and nothing will develop for a while.
Still a great share but will probably drift until next results /update.

[noujay] 13/8/2018 17:56

Pretty lacklustre at the moment here - had certainly expected it to hold higher than it has