Playtika double upgraded to Buy at BofA

As previously reported, BofA upgraded Playtika (PLTK) to Buy from Underperform with a price target of $6.50, up from $6. Playtika boasts the industry’s highest profitability with 30% EBITDA margins, the industry’s largest direct-to-consumer platform, and three of the largest and longest running franchises in mobile gaming history, the analyst tells investors. Given an all-time high next twelve months free cash flow yield of 21% and a dividend yield of 9%, the firm thinks downside to the shares is limited and believes a “share price dislocation” has been driven by the exit of a large shareholder in a low trading liquidity, concerns that Playtika’s transition to growth has taken too long and investor preference for mobile ad networks assets over publishers.