NYX GAMING GROUP LTD 11 PCT DEBS V.NYX.DB

CANACCORD ON NYX tonight

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NYX Gaming Group* (NYX : TSX-V : $1.80), Net Change: 0.02, % Change: 1.12%, Volume: 241,284 PLACE YOUR BETS. NYX Gaming will report its Q2 results before the market opens on August 29, and provide investors a first look at OpenBet under the NYX Gaming banner. Canaccord Genuity Tech Analyst Kevin Wright likes the strategic rationale for the acquisition and believes that there is opportunity for good long-term growth. His estimates for the H2 and 2017E have left room for him to accelerate growth if the NYX and OpenBet teams can exceed expectations in the core business or OpenBet segments. NYX stock trades at 5.6x, which Wright views as undervalued against peers broadly between 8.4x and 16.3x. He acknowledges that macro, sectoral and company issues have converged since the deal was announced resulting in price erosion; however, Wright believes the discount is too steep given the stickiness of revenue and quality of the OpenBet asset. As for this quarter, Wright’s $11.2M adjusted EBITDA forecast is at the high end against the Street’s $9.5M, so he is of the opinion that management can meet and likely beat expectations. Overall, Wright says he would be a buyer heading into the quarter; as he thinks NYX can meet or exceed consensus if the core continues to post solid growth and a first look at OpenBet, should provide investors with initial confidence that the segment can deliver financially.