Stride Gaming (STR)

Business description

Stride Gaming is a leading online gaming operator in the UK. It uses its proprietary and purchased software to provide online bingo and slot gaming and a social gaming mobile app. It was formed in 2012 and only operates in regulated real money gaming markets.

Y/E Aug Revenue (£m) EBITDA (£m) PBT (£m) EPS (fd) (p) P/E (x) P/CF (x)
2016A 47.8 12.3 11.3 20.3 11.5 8.3
2017A 89.9 20.2 18.9 25.8 9.0 11.0
2018E 101.0 19.2 17.0 20.2 11.5 10.0
2019E 112.8 23.0 20.3 23.9 9.7 8.5

Last updated on 06/12/2017

Investment summary

Stride Gaming is a leading online gaming operator. The company is achieving strong organic growth in real-money gaming and now has a market share of 12%. Net gaming revenues increased by 18% to £89.9m in FY17, driven by an impressive 39% organic growth in the core real money gaming (RMG). Adjusted EBITDA of £20.2m was slightly above our recently raised estimates. The company has invested heavily in technology and operational leverage should kick in as acquired customers migrate to the higher-margin proprietary platform. A small investment into the Indian rummy market could also lead to diversified revenue growth.

Last updated on 13/12/2017

Industry outlook

H2 Gambling Capital estimates that the UK bingo-led market generates approximately £800m in gross gaming revenue (or £600-650m net gaming revenues). Market growth of c 7% pa is being driven by slots and mobile usage. The extension of the UK 15% POC tax from net to gross RMG revenue is in our forecasts, with Stride's first payments starting in October 2017.

Last updated on 13/12/2017

Key management

Eitan Boyd, CEO
Ronen Kannor, CFO

Company address

Unit 450
Highgate Studios
53-79 Highgate Road
London
NW5 1TL
United Kingdom
+44 (0)20 7284 6080
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