Playtech Share Discussion Threads

[dennislevine] 04/11/2017 11:05

shaker44: the fall in market cap is much more than Euro300m, more like >Euro 500m. The mkt was already heavily discounting the unregulated revenue stream in the low multiple for Playtech relative to peers and other online gambling companies - now it looks like the unregulated revenues are effectively valued at zero.

UBS research put out a detailed note on 22 June - this showed that on their numbers they worked out the implied multiple for the unregulated side of the business was just 2x - this was on the share price at the time of £10.

Even with a haircut now to some of those unregulated revenues after the update last week it seems the market is attributing no value at all to this part of the business.

Sun Bingo contract clearly remains problematic but that was flagged in interims - no quick fix by the sounds of it but one would hope that given time and Playtech's expertise they will start to turn it around.

All in all hard to see there is a massive change in the underlying fundamentals - structural growth industry, leading B2B player, financial trading division with improved scale & diversity. Sentiment has taken a short term knock but still a growth industry / business that generates plenty of cash.

No doubt a few fund managers with egg on face having bought into the Sagi placing not so long ago above £9.

[shaker44] 04/11/2017 05:28

So if e20m was removed from analyst forecasts and about e300m from Ptec cap value, analysts assume the same shortfall for 15 years?? Seem likely to you, or is it now a screaming buy?

[nod] 04/11/2017 02:54

From InterGame site today"Following news of its profits warning yesterday, Playtech has revealed more detail of its problems in Asia.Shares fell 20 per cent on the news released yesterday that the group's profits would be five per cent lower than the lower estimates of market expectations. Around €20m was removed from the company's forecasts by analysts.It is understood that the main Asian culprit for Playtech is Malaysia, currently an unregulated market but its government is taking steps to prevent Malaysians from accessing online gambling sites and mobile apps. The regulators there are looking at ways to close loopholes in its Common Gaming House Act of 1953 that currently enable Malaysians to gamble online.As reported yesterday, the company's problems are also exacerbated by the complex situation concerning the contract with Sun Bingo in the UK, for which Playtech provides the technology. This has run into problems and the Sun Bingo site is being relaunched."

[nod] 03/11/2017 21:09

It's hard to fathom why Sun Bingo has been such a headache for PTEC. In the past these situations have usually been due to a difficult customer, as with WHO a few years back. PTEC can't publicly say that though.Asia as a whole was a booming market and gets a lot of mentions in the last Annual Report and the Interim Report as high growth. India was singled out as a big opportunity.Malaysia sent PTEC and others into free fall in November 2014. Malaysian laws were drafted in the 50's and 60's and didn't fit online gambling, so were arbitrarily applied.Malaysian giant Genting operates in Malaysia and a lot of what the Malay Govt does seems to be to help Genting - by squashing competitors claiming they are illegal, although the laws were not readily applicable. I don't know if the legal situation has been tidied up in recent years.Malaysia has a lot of Chinese gambling tourists.

[lyme regis1] 03/11/2017 17:38

With nations getting richer and having more spare money the only way is up for this market leader - this is a global company not reliant on one country or source

[tsmith2] 03/11/2017 17:16

Set up for next week, bullish intra day reversal

[pre] 03/11/2017 14:38

That's it...it's turned....the buyers flooding in now...

[pre] 03/11/2017 14:30

Sheer strength suggests someone is closing/accumulating imo...look at some of those big trades going through....

[pre] 03/11/2017 14:04

Looking very strong and no surprises given the circumstances...blue shortly...

[pre] 03/11/2017 10:55

03-Nov-17 Investec Securities Buy 1,120.00 1,030.00 Reiteration

[shaker44] 03/11/2017 10:12

Maybe that history is a learning experience for PTEC FD to manage city expectations rather better, so they surprise to the upside and not to the downside- or maybe its just coincidence.

[moneygenxyz] 03/11/2017 09:44

Looking back at the charts alone, this kind of drop is quite usual for PTEC in around November time. It tracks lower until about Jan-Feb then picks up again. History does rhyme.

[pre] 03/11/2017 09:10

Wonder who those large buy trades belong to....buy-backs or II's ?

[shaker44] 03/11/2017 09:08

''Still, given the uncertainty around the regulatory environment in Malaysia, at 737p, we move to hold.''
This from Investors chronicle doesnt help. Only HOLD at 737?!

Surely the Malaysia issue alone can not justify 700m off the capital value, and yet no recovery in share price yet...

[dennislevine] 03/11/2017 09:01

There are quite a few levers the company can use here, they keep talking about M&A but best use of excess cash / strong balance sheet will be buying back their own shares at these levels

PLUS has been a great investment for them but now looks non-core so could also potentially monetise this stake to fund a buyback or special dividend

As was seen with Paysafe plenty of private equity firms looking for cash generative tech / software businesses at attractive valuations - just a thought

[pre] 03/11/2017 08:57

Just look at the size of that trade...1.6 Million...wonder where that's gone to?

[polaris] 03/11/2017 08:52

After a drop like that you usually have to wait 1-1.5 days to see what the real new direction will be. There is usually a fall on open on the 2nd day as people who do not follow intraday read about the "issues" and put sell orders in for 1st thing the following day. There should be more clarity by lunchtime today on trade strength. Even if it is only a dead cat bounce then you would expect to see anything up to 5% over the coming 2-3 trading days.

The size of the fall is down to the vagueness of the statement re trading in Asia. The rest of the group is doing well but there is also the general uncertainty in the betting arena on FOBT. Personally, i don't think it will affect PTEC much at all, or the betting co's as we are talking about a few problem betters that really do need help.

I'm in this morning and looking for a bounce at the very least.

regards,

Paul

[pre] 03/11/2017 08:40

Some big buys going through...another 59K buy just reported...interesting...good to see positive brokers libertime, thanks:-)

[oohrogerpalmer] 03/11/2017 08:39

Bit worrying that after initial fall we haven't seen a bounce back up a little.
Fully expected a pick up today which doesn't look like happening.
Was contemplating adding last night now I'm more inclined to sell up!!!
Can't understand how this news could have justified the amount it has fallen and today's down start would indicate their is something not right?

[libertine] 03/11/2017 08:28

03 Nov Playtech Ltd Liberum Capital Buy 764.25 1,020.00 1,020.00 Retains
03 Nov Playtech Ltd Deutsche Bank Buy 764.25 1,175.00 1,060.00 Reiterates

[pre] 03/11/2017 08:25

Buyers moving in now...some massive earlier buys....

[pre] 03/11/2017 08:22

looks way overdone...no justification for such a large fall imo...wouldn't be surprised to see directors buying at this level...

[citytrader66] 03/11/2017 08:14

no dead cat bounce today. once 748 goes its.. looking for a sub £7 entry here. gla

[tsmith2] 03/11/2017 08:07

in for 10-20%