Analysts at Citizens JMP have claimed that operator Super Group are one of the more ‘attractive’ ways to own the gambling space after publishing their review of the company – who have enjoyed a strong overall performance in recent times.
Their current model is anchored by their iCasino-first approach but it has also been boosted by their strong presence in Africa, which remains one of the emerging markets to keep an eye on.
However, iCasino has been a particularly fruitful area, with casino gaming representing approximately 80% of revenue across jurisdictions.
The analysts have commented on their current stability, which has come from their dual-brand strategy through BetWay and Spin and Citizens have projected a 71% EBITDA expansion through 2027.
Citizens said: “The company controls its destiny around the path forward on utilising its cash, with no debt and FCF increasing to $498m by 2027E, or a 9% yield against the current stock price.”
Their recent upturn saw a 287% increase in the company’s share price from its 52-week low and Citizens have backed them to continue to grow.
As mentioned, their current position in Africa, which saw them generate $759m in trailing twelve-month revenue, representing 39% of the company’s total, remains strong and growing.
The firm also noted that parlays represent 70% of handle across its African markets, compared to 30% in the US, leading to impressive net gaming revenue margins and potential areas for more growth.
Citizens added: “Global marketing partnerships, combined with localised offerings, promote and sustain the value of the brand to an end customer with a high tendency to wager using parlays.”
Later this year, the operator have a planned September investor event and potential online gambling legalisation in Alberta, which could drive upside in coming quarters. Plus, the firm said it expects management to discuss cash deployment strategies beyond the current dividend at the investor day.
Recent news from the US revealed that they are leaving the market in North America, due to their intricacies of the regional areas which is shaping the legal landscape.
Having established themselves over nine states and gone toe-to-toe with DraftKings and FanDuel, rising tax rates and marketing costs are among the key reasons for backing out of the market.
Their focus remains on key and emerging markets but their US exit will incur one-time restructuring cash cost of between $30m to $40m, with cost savings expected to have an effect on 2026 results.
