Analysts at Canaccord Genuity initiated coverage on mobile gaming content developer Gaming Realms at ‘buy’ on Monday, stating it was now reaping the benefits from two important strategic decisions taken by management.
Canaccord Genuity said Gaming Realms’ decision to acquire “the highly popular and successful Slingo brand in 2015” and its subsequent decision to divest its business-to-consumer division in 2017 in order to focus on “the less capital intensive but highly profitable and scalable” brand and content licensing model was now paying off.
The Canadian bank highlighted that after having achieved positive underlying earnings in its 2020 trading year, Gaming Realms was “primed for further rapid revenue and profit growth” as the Slingo format looks set to gain further traction with consumers.
“A growing number of licensing relationships with large global operators alongside an expanding proprietary portfolio of games and content leaves Gaming Realms particularly well-placed to take advantage of the significant forecast growth in iGaming, especially in the rapidly expanding North American market post-legislative changes,” said the analysts.
Canaccord, which also issued the stock with a 50.0p target price, also pointed out that it sees scope for “further significant international expansion opportunities” for Gaming Realms.
