Esports Entertainment: Competitive Gaming And Online Gambling Growth Equate To Large Upside Ahead

Esports Entertainment: Competitive Gaming And Online Gambling Growth Equate To Large Upside Ahead

Esports Entertainment is an online gambling company that offers esports entertainment, esports wagering and igaming and traditional sports betting. The company offers odds wagering, fantasy and pools on various esports events on its licensed and secure Vie.gg wagering platform and owns and operates an online sports book at SportNation.bet. In late 2020 Esports Entertainment became the first esports-focused gaming business to acquire a US gambling license.

June 30, 2021

Price (as of close on June 29, 2021)

$10.88

Rating

BUY

12- Month Target Price

Esports Entertainment (GMBL)

Esports Entertainment delivers 129% sequential revenue growth during Q3:21 and raises FY22 revenue guidance from $70 million to $100-$105 million. We reiterate our Buy rating and .     

Q3:21 Highlights

➢ GMBL operating esports gaming platforms, event venues and owns proprietary esports infrastructure and technology. The gaming market consists of at least 2.5 billion gamers globally. Some 500 million of these gamers are esports fans. Surveys indicate that given the chance ,50% of gamers would like to wager on game outcomes, creating a $750 million esports wagering market projected to expand to $3 billion in five years.  

➢GMBL generated $5.4 million of Q3:21 revenues, up 129% from Q2:21, and gross profits of $3.1 million, up 199% from the prior quarter as a result of organic growth and the acquisition of Lucky Dino.    

➢In addition to completing the Lucky Dino transaction, during the March quarter the company closed the purchase of Esports Gaming League, completed a $30 million share offering, launches its Vie.bet and SportNation.com brands on its Malta gaming license, filed a New Jersey gaming license and signed esports tournament partnerships with several professional sports teams.      

➢In late May GMBL acquired Gameday Group’s B2C business operating under the BetHard brand for €16 million cash and a 12% net gaming share for two years. This acquisition is expected to add at least $31 million to annual net gaming revenues as well as two new gaming licenses, including one in the Swedish market.     

GMBL upped its FY22 revenue guidance to $100-$105 million versus consensus estimates of $70 million. We reiterate our Buy rating and .

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