Sportradar under pressure after short report calling for over 70% downside

Callisto Research says it is short Sportradar (SRAD), “a self-styled ‘Sports Integrity’ leader with ties to illegal gambling, sanctioned parties, criminals, and a completely fake regulator.” Callisto believes “Sportradar’s ties to illegality pose an existential threat.” “Through examination of hundreds of gambling platforms, we found evidence suggesting that over 270 individual platforms are using Sportradar’s products or services, or explicitly claiming to do so, while operating illegally in regulated or prohibited gambling markets. Many of these operators have no license whatsoever. We believe this exposure is material… These relationships are incompatible with the regulatory requirements Sportradar must conform to in key markets. We have shared our findings with multiple regulators in North America and Europe. Three US gambling regulators have already commenced reviews. We believe Sportradar will have to choose between surrendering its revenue from illegal operators or losing its licenses in Europe and North America. If we are correct, we predict over 70% downside from SRAD’s current valuation,” the report reads. Shares of Sportradar have dropped over 8% to $15.45 in morning trading.