In a report released today, James Wheatcroft from Jefferies maintained a Hold rating on Evolution Gaming Group AB, with a price target of SEK630.00.
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James Wheatcroft has given his Hold rating due to a combination of factors, including a major change in Evolution Gaming’s capital allocation strategy. The company announced a substantially larger €2.0bn share repurchase plan over the next year—far above prior expectations—which should highlight its strong cash generation and help streamline the balance sheet.
At the same time, Wheatcroft is cautious because this expanded buyback will effectively use up the firm’s current net cash, while management still aims to maintain a net cash position in the long run. He also recently shifted to a Hold stance amid uncertainty surrounding the ongoing PTEC legal dispute, and believes the stock’s current valuation multiple and free cash flow yield already discount regulatory and legal risks, justifying an unchanged $630 target price.
According to TipRanks, Wheatcroft is a 4-star analyst with an average return of 3.9% and a 45.92% success rate. Wheatcroft covers the Consumer Cyclical sector, focusing on stocks such as Lottomatica Group S.P.A., Jet2 PLC, and J D Wetherspoon.