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Playtech (GB:PTEC)
LSE:PTEC
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Playtech (PTEC) AI Stock Analysis

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GB:PTEC

Playtech

(LSE:PTEC)

Rating:78Outperform
Price Target:
462.00p
▲(8.71% Upside)
Playtech's strong technical momentum and positive earnings call insights drive its score. Financial performance is a concern, particularly with profitability and leverage, but strategic initiatives and market positioning provide optimism.
Positive Factors
B2B Business Performance
Playtech has seen good momentum continue across B2B and a better than expected contribution from associates, primarily driven by favourable sports margins at Caliente.
Revenue Growth
Playtech highlights 'very strong' revenue growth in the US, 'significant' product demand in the Americas and a 'very strong' SaaS performance.
Shareholder Returns
Following completion of the €2.3bn sale of Snaitech to Flutter, Playtech will now return c€1.8bn to shareholders via a €5.73 (c490p) special dividend.
Negative Factors
Regulatory Challenges
Initial regulatory headwinds in Brazil and Colombia are noted as challenges.
Valuation Concerns
Headline valuation remains low at 6.5x EV/EBITDA, indicating a potentially undervalued stock.

Playtech (PTEC) vs. iShares MSCI United Kingdom ETF (EWC)

Playtech Business Overview & Revenue Model

Company DescriptionPlaytech (PTEC) is a leading global technology company that specializes in the development of software and services for the online gaming and gambling industry. Founded in 1999, Playtech operates across multiple sectors including online casino, sports betting, poker, and live gaming. The company provides a comprehensive suite of products and platforms designed to enhance the player experience and enable operators to optimize their offerings, with a strong focus on innovation and regulatory compliance.
How the Company Makes MoneyPlaytech generates revenue primarily through the licensing of its software products and services to online gaming operators. Key revenue streams include the sale of gaming content, platform services, and the provision of technology solutions to both B2B (business-to-business) and B2C (business-to-consumer) clients. The company also earns income from its own online gaming operations. Significant partnerships with operators and a diversified portfolio of games, including slots, table games, and live dealer products, contribute to its financial performance. Additionally, Playtech's strategic collaborations with established brands and its expansion into regulated markets enhance its earnings potential.

Playtech Earnings Call Summary

Earnings Call Date:Mar 27, 2025
(Q4-2024)
|
% Change Since: 47.50%|
Next Earnings Date:Sep 11, 2025
Earnings Call Sentiment Positive
The earnings call highlighted Playtech's strong financial performance in 2024, driven by growth in its B2B division and strategic transformations. The company is seeing positive developments in key markets and is strategically positioned for future growth. However, challenges remain with underperforming B2C assets, regulatory impacts in Brazil, and declines in Asia. Overall, the highlights outweigh the lowlights, indicating a positive outlook.
Q4-2024 Updates
Positive Updates
Strong Financial Performance in 2024
Playtech reported adjusted EBITDA of €480 million, up 11% year-on-year, with strong momentum in the B2B division, achieving 22% growth in B2B adjusted EBITDA to €222 million.
Strategic Agreements and Transformations
Playtech signed landmark agreements, including the sale of Snaitech to Flutter for €2.3 billion and a revised strategic agreement with Caliplay, setting a new medium-term adjusted EBITDA target for continuing operations of €250 million to €300 million.
Significant Reduction in Net Debt
Playtech reduced net debt to €143 million at the end of 2024 from €283 million a year earlier, reflecting strong cash generation and strategic debt repayments.
Expansion in Regulated Markets
The B2B division saw significant growth in regulated markets, including a 15% increase in Latin America revenue and a 126% increase in the U.S. and Canada, albeit from a small base.
Innovations in AI and Operational Efficiency
Playtech is leveraging AI to drive efficiencies, including the implementation of GitHub Copilot for developers and AI to monitor performance in studios.
Positive Developments in Key Markets
Playtech's strategic positions in the U.S., Brazil, and Latin America are expected to contribute to significant future growth, with Brazil's market regulation commencing in January 2025.
Negative Updates
Underperforming B2C Assets
B2C revenue growth was modest at 2%, with some businesses like HappyBet remaining loss-making and under consideration for closure or sale.
Impact of Regulatory Changes in Brazil
The new stringent regulatory environment in Brazil caused high KYC rejection rates, impacting volumes in January 2025.
Challenges in Asia
Revenues in Asia declined, particularly in China, and Playtech is restructuring its distributor agreements to focus on regulated markets in Asia.
Potential Margin Pressure in Live Casino
Despite growth, EBITDA from Live Casino declined from €53 million in 2023 to €50 million in 2024 due to investment in increased studio capacity.
Company Guidance
During a recent call, Playtech provided guidance reflecting strong financial performance and strategic plans for the future. In 2024, the company achieved a robust adjusted EBITDA of €480 million, marking an 11% year-on-year increase and surpassing previous expectations. The B2B division led this growth with a 22% rise in adjusted EBITDA to €222 million. Playtech outlined a new medium-term adjusted EBITDA target for continuing operations of €250 million to €300 million, factoring in a revised agreement with Caliplay. The company also anticipates generating a free cash flow of €70 million to €100 million. Strategic moves included the sale of Snaitech to Flutter for €2.3 billion, expected to be completed in Q2 2025, with a special dividend payout of €1.7 billion to €1.8 billion anticipated upon deal closure. The company aims to maintain a strong balance sheet, reducing net debt to €143 million by the end of 2024, and plans to utilize proceeds from the Snaitech sale to achieve a net cash position by the end of 2025. Looking ahead, Playtech is focused on leveraging growth opportunities in attractive markets such as the U.S. and Brazil, emphasizing operational efficiency and innovative content delivery to drive future success.

Playtech Financial Statement Overview

Summary
Playtech exhibits a mixed financial performance with strong gross profitability and a healthy cash flow position. However, challenges in revenue growth, net profitability, and leverage persist. The company is showing positive signs of financial stabilization, but it needs to address profitability and growth consistency to improve its financial standing further.
Income Statement
72
Positive
Playtech's revenue has shown a somewhat erratic pattern over the years, with a significant drop in 2024 compared to 2023. The gross profit margin for 2024 was strong at 100%, but the net profit margin was notably lower than the gross profit margin, indicating high operating expenses or other costs. The EBIT and EBITDA margins demonstrate decent operational efficiency, although there was a notable decline in EBIT margin from 2023 to 2024. Overall, the income statement reflects a company with strong gross profitability but facing challenges in maintaining consistent revenue growth and net profitability.
Balance Sheet
65
Positive
The balance sheet displays a relatively stable financial position with a decreasing trend in total debt over the years, which is positive. However, the debt-to-equity ratio remains a concern, indicating that Playtech relies significantly on debt financing. The equity ratio has shown improvement, suggesting enhanced reliance on equity financing, which is a positive aspect. Return on equity has varied significantly, highlighting profitability challenges. Overall, the balance sheet suggests a company aiming to stabilize its financial structure but facing leverage concerns.
Cash Flow
68
Positive
Playtech's cash flow statement indicates positive free cash flow, though the growth rate has been inconsistent. The operating cash flow to net income ratio is robust, demonstrating strong cash generation relative to net income. However, fluctuations in free cash flow and investing cash flows suggest variability in investment activities and cash generation. Overall, the cash flow position is healthy, but the inconsistency in growth and cash allocation strategies could pose potential risks.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue848.00M1.71B1.60B1.21B1.08B
Gross Profit848.00M771.90M1.60B1.21B1.08B
EBITDA316.50M282.50M376.60M269.90M212.50M
Net Income223.20M156.80M40.60M674.60M-73.04M
Balance Sheet
Total Assets3.30B3.33B3.02B3.65B3.06B
Cash, Cash Equivalents and Short-Term Investments268.10M516.20M426.50M575.40M683.68M
Total Debt494.00M732.90M633.40M1.13B1.26B
Total Liabilities1.48B1.52B1.32B2.07B2.16B
Stockholders Equity1.82B1.82B1.70B1.58B899.59M
Cash Flow
Free Cash Flow235.30M216.90M285.50M110.80M247.47M
Operating Cash Flow391.10M366.90M410.90M225.00M366.92M
Investing Cash Flow-188.40M-309.50M-358.30M-127.60M-89.35M
Financing Cash Flow-266.00M39.90M-566.90M-218.40M104.62M

Playtech Technical Analysis

Technical Analysis Sentiment
Positive
Last Price425.00
Price Trends
50DMA
374.63
Positive
100DMA
339.85
Positive
200DMA
313.10
Positive
Market Momentum
MACD
16.68
Negative
RSI
65.43
Neutral
STOCH
74.40
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:PTEC, the sentiment is Positive. The current price of 425 is above the 20-day moving average (MA) of 407.68, above the 50-day MA of 374.63, and above the 200-day MA of 313.10, indicating a bullish trend. The MACD of 16.68 indicates Negative momentum. The RSI at 65.43 is Neutral, neither overbought nor oversold. The STOCH value of 74.40 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:PTEC.

Playtech Peers Comparison

Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
78
Outperform
£1.32B13.316.42%
72
Outperform
£653.93M14.6612.43%1.07%9.68%126.73%
66
Neutral
£142.12M16.1330.30%21.54%48.51%
63
Neutral
£1.73B10.494.37%3.49%0.66%-39.52%
61
Neutral
£5.87B-28.60%1.55%5.14%-7.80%
50
Neutral
£279.17M-379.34%2.55%-239.10%
* Consumer Cyclical Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
GB:PTEC
Playtech
425.00
179.70
73.26%
GB:EVOK
888 Holdings
61.30
6.15
11.15%
GB:RNK
Rank Group plc
139.60
66.34
90.55%
GB:GMR
Gaming Realms
50.60
10.00
24.63%
GB:ENT
Entain plc
887.00
274.70
44.86%

Playtech Corporate Events

Business Operations and StrategyFinancial Disclosures
Playtech Aligns Leadership Incentives with Transformation Plan
Positive
Aug 4, 2025

Playtech has announced the granting of conditional awards under its Transformation Plan following the sale of Snaitech S.p.A. These awards, part of a pool of 10,000 Incentive Units, align the interests of Playtech’s senior team with shareholders by tying potential rewards to the company’s performance in terms of EBITDA and cash generation. The plan aims to drive earnings growth and improve cash generation, ultimately benefiting shareholders.

The most recent analyst rating on (GB:PTEC) stock is a Buy with a £7.80 price target. To see the full list of analyst forecasts on Playtech stock, see the GB:PTEC Stock Forecast page.

Other
Playtech Directors Increase Shareholdings, Signaling Confidence
Positive
Jun 13, 2025

Playtech announced that Ian Penrose, Senior Independent Non-executive Director, and his wife Vanessa Penrose have purchased a total of 30,000 ordinary shares in the company at £3.135 per share. This acquisition reflects confidence in Playtech’s market position and future prospects, potentially impacting stakeholder perceptions positively.

The most recent analyst rating on (GB:PTEC) stock is a Buy with a £7.80 price target. To see the full list of analyst forecasts on Playtech stock, see the GB:PTEC Stock Forecast page.

Other
Playtech Chairman Acquires Significant Shareholding
Positive
Jun 5, 2025

Playtech plc announced that its Non-executive Chairman, John Gleasure, has acquired 95,000 ordinary shares of the company at a price of £3.0644 per share, totaling £291,118. This transaction, conducted on the London Stock Exchange, highlights a significant investment by a key executive, potentially indicating confidence in the company’s future prospects and stability in the gambling technology sector.

The most recent analyst rating on (GB:PTEC) stock is a Buy with a £9.03 price target. To see the full list of analyst forecasts on Playtech stock, see the GB:PTEC Stock Forecast page.

Dividends
Playtech Announces Special Dividend Currency Election Details
Neutral
Jun 3, 2025

Playtech has announced the currency conversion rate for its Special Dividend, allowing shareholders to receive their dividend in Sterling instead of Euros. The conversion rate is set at £4.79028 per share, based on a EUR:GBP exchange rate of 0.836, reflecting the company’s commitment to providing flexible financial options for its stakeholders.

The most recent analyst rating on (GB:PTEC) stock is a Buy with a £7.80 price target. To see the full list of analyst forecasts on Playtech stock, see the GB:PTEC Stock Forecast page.

M&A TransactionsBusiness Operations and Strategy
Playtech Agrees to Transfer German HAPPYBET Assets to pferdewetten.de
Neutral
May 28, 2025

Playtech has reached an agreement with NetX Betting Ltd., a subsidiary of the German operator pferdewetten.de AG, to transfer its German HAPPYBET assets. This move aligns with Playtech’s strategy to focus on its core B2B operations. The agreement allows pferdewetten.de to negotiate with franchise partners for the HAPPYBET shops in Germany and assume ownership of certain hardware. A transition period will follow for negotiations and regulatory approvals, with any remaining assets not transferred to pferdewetten.de intended to cease operations.

The most recent analyst rating on (GB:PTEC) stock is a Buy with a £7.80 price target. To see the full list of analyst forecasts on Playtech stock, see the GB:PTEC Stock Forecast page.

Executive/Board ChangesShareholder Meetings
Playtech Announces AGM Results and Leadership Change
Neutral
May 21, 2025

Playtech announced the results of its Annual General Meeting held on 21 May 2025, where most resolutions were passed, except for resolutions 12 and 13. Resolutions 2, 6, 7, and 8 were approved but received less than 80% support. The company plans to engage with shareholders who opposed these resolutions to address their concerns. Additionally, John Gleasure has been appointed as the new Chair of the Board, succeeding Brian Mattingley.

The most recent analyst rating on (GB:PTEC) stock is a Buy with a £7.80 price target. To see the full list of analyst forecasts on Playtech stock, see the GB:PTEC Stock Forecast page.

M&A TransactionsDividendsBusiness Operations and StrategyFinancial Disclosures
Playtech Reports Strong Start to 2025 Amid Strategic Transition
Positive
May 21, 2025

Playtech has reported a solid start to 2025, with performance aligning with expectations and progress in its transition to a predominantly B2B business. The sale of Snaitech to Flutter Entertainment has strengthened its balance sheet, allowing for a significant dividend payout to shareholders. The company is experiencing strong revenue growth in the US, particularly in live casino and platform services, despite regulatory challenges in Latin America. Playtech remains confident in its growth opportunities, supported by strategic and operational advancements.

The most recent analyst rating on (GB:PTEC) stock is a Buy with a £7.80 price target. To see the full list of analyst forecasts on Playtech stock, see the GB:PTEC Stock Forecast page.

Executive/Board ChangesM&A TransactionsDividendsBusiness Operations and StrategyFinancial Disclosures
Playtech Reports Strong Start to 2025 and Strategic Progress
Positive
May 21, 2025

Playtech has reported a strong start to 2025, with trading aligning with expectations and significant progress in its transition to a predominantly B2B business model. The company has seen robust growth in software fees from Caliplay and strong revenue growth in the US market, particularly in live casino offerings. Despite regulatory challenges in Latin American markets, Playtech remains optimistic about future opportunities. The recent €2.3 billion sale of Snaitech to Flutter Entertainment will allow Playtech to distribute approximately €1.8 billion to shareholders as a special dividend, further strengthening its balance sheet. Additionally, Playtech is redeeming €150 million of senior secured notes to bolster its financial position. The company is also undergoing a leadership change with John Gleasure assuming the role of Chairman.

The most recent analyst rating on (GB:PTEC) stock is a Buy with a £7.80 price target. To see the full list of analyst forecasts on Playtech stock, see the GB:PTEC Stock Forecast page.

Executive/Board ChangesRegulatory Filings and Compliance
Playtech Executives Acquire Shares, Signaling Confidence in Future
Positive
May 13, 2025

Playtech announced that its CEO, Mor Weizer, and CFO, Chris McGinnis, have purchased shares in the company as part of their remuneration policy, which defers a portion of their annual bonus into shares. This move aligns with the UK Market Abuse Regulation and reflects the executives’ confidence in the company’s future prospects, potentially impacting stakeholder perceptions positively.

The most recent analyst rating on (GB:PTEC) stock is a Buy with a £7.80 price target. To see the full list of analyst forecasts on Playtech stock, see the GB:PTEC Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Aug 04, 2025