Credit Suisse Initiate CoverageWith an even better target. Just added a few more once we dropped back below $36.00. GLTA
Score Media and Gaming Inc.) should be a leader in Canada, according to Credit Suisse analyst Benjamin Chaiken, who also sees “a reasonable case for the company to increase its share in the U.S., neither of which at present we believe is fully reflected in the stock.”
In a research note released Tuesday, he initiated coverage with an “outperform” rating.
“Our Outperform rating is based on the following factors: (1) SCR should be in a leadership position in Canada. We think that the Canadian sports betting total addressable market could reach $4-7-billion, and given SCR is one of the most well-known media brands in the country, we think it has the ability to capture 20-per-cent-plus share in OSB and 5-10-per-cent share in iGaming, representing a potential $500-900-million revenue opportunity; (2) SCR should have lower CAC vs peers in Canada. We believe SCR can leverage its media arm to create a very efficient customer acquisition process, essentially onboarding through the low cost media app and transitioning to OSB/iGaming; (3) We think SCR should have better margins vs peers in Canada, potentially 35 per cent-plus in Canada at maturity, with no land-based casino partner requirements and lower external marketing costs than peers, leveraging its media arm/brand and existing market penetration; and (4) the company is also part of the fast-growing OSB and iGaming market in the United States (with market access in 13 states), and should increase share leveraging the media app for low cost customers acquisition, strong retention, and an integrated betting/media experience which is not widely available,” said Mr. Chaiken.
He set a target of US$49 per share. The average is $29.25 (Canadian).