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Super Group (SGHC) (SGHC)
NYSE:SGHC
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Super Group (SGHC)
(NYSE:SGHC)
Rating:80Outperform
Price Target:
$11.50
▲(5.41%Upside)
Positive Factors
Balance Sheet
SGHC reported $351M in cash and no debt, highlighting a clean balance sheet and strong financial position.
Financial Performance
SGHC exceeded revenue and adjusted EBITDA expectations for 1Q by 12% and 39%, respectively.
Operational Efficiency
The company continues to get more efficient with its marketing spend, including a new F1 partnership that will drive global exposure for its Betway and Jackpot City brands among a different audience.
Negative Factors
U.S. Market Profitability
The valuation now includes the U.S. business, which remains loss-making but is showing clear signs of progress, viewed as appropriate given the company's success in recalibrating the U.S. strategy, and on a credible path toward profitability.
Super Group (SGHC) (SGHC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$5.47B
Dividend Yield1.46%
Average Volume (3M)1.22M
Price to Earnings (P/E)39.5
Beta (1Y)1.44
Revenue Growth22.80%
EPS Growth281.38%
CountryUS
Employees3,589
SectorConsumer Cyclical
Sector Strength57
IndustryGambling, Resorts & Casinos
Share Statistics
EPS (TTM)0.12
Shares Outstanding501,431,430
10 Day Avg. Volume1,545,649
30 Day Avg. Volume1,219,839
Financial Highlights & Ratios
PEG Ratio-0.02
Price to Book (P/B)5.41
Price to Sales (P/S)0.00
P/FCF Ratio15.74
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$11.83Price Target Upside8.43% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering6
Super Group (SGHC) Business Overview & Revenue Model
Company DescriptionSuper Group (SGHC) is a global digital gaming and sports entertainment company operating in the online betting and gaming sectors. The company provides a wide range of online gaming and betting products, including sports betting, casino games, and other interactive gaming services. Super Group operates under several well-known brands, offering a diverse portfolio of entertainment options to its international audience.
How the Company Makes MoneySuper Group (SGHC) generates revenue primarily through online betting and gaming activities. The company's key revenue streams include sportsbook and casino operations, where users place bets on various sporting events and engage in a variety of casino games, respectively. Super Group monetizes its platform by taking a percentage of the wagers placed by users, known as the 'hold'. Additionally, the company may earn revenue from advertising partnerships and sponsorships with sports organizations. Its earnings are further supported by strategic partnerships with technology providers and gaming operators, which enhance the user experience and expand its market reach.
Super Group (SGHC) Earnings Call Summary
Earnings Call Date:May 08, 2025
(Q1-2025)
| % Change Since: 24.69%|
Next Earnings Date:Aug 07, 2025
Earnings Call Sentiment Positive
Super Group reported a strong first quarter with record-breaking revenue and significant growth in adjusted EBITDA. Positive performances in Africa and Europe, coupled with improvements in the U.S. iGaming business, were key drivers. However, challenges such as the decline in the APAC region, regulatory issues in New Zealand, and potential tax hikes in New Jersey temper the outlook.Q1-2025 Updates
Positive Updates
Record-Breaking First Quarter Revenue
Super Group achieved an all-time high first quarter total revenue of $517 million, representing a 25% year-over-year increase.
Significant Growth in Adjusted EBITDA
The company reported a 120% increase in adjusted EBITDA year-over-year to $111 million, with a combined margin of approximately 22%.
Strong Performance in Africa and Europe
Africa grew 54% year-over-year, driven by steady development in countries like South Africa, Ghana, and Malawi. Europe also showed a 53% increase year-over-year, with the UK up 87%.
Successful U.S. Business Transition
The U.S. iGaming business is progressing according to plan, with EBITDA improving from an $11 million loss in Q4 2024 to a $10 million loss in Q1 2025.
High Customer Engagement
The company set a new record for unique monthly active customers, averaging 5.4 million for the quarter.
Strong Cash Position
Super Group ended the quarter with unrestricted cash of $351 million and no debt, highlighting a strong free cash flow profile.
Negative Updates
APAC Region Decline
The APAC region was significantly affected by currency weakness and the closure of non-performing markets, resulting in a 13% year-over-year decrease.
Regulatory Challenges in New Zealand
Growth in New Zealand was constrained by regulatory limits on marketing, causing a decline of 7% year-over-year in dollar terms.
Potential Tax Hike in New Jersey
There is ongoing monitoring of a proposed tax hike in New Jersey, which could impact profitability in the U.S. market.
Company Guidance
In the first quarter of 2025, Super Group reported a record total revenue of $517 million, marking a 25% year-over-year increase, and an adjusted EBITDA of $111 million, up 120% year-over-year, with a 22% margin. The company saw significant growth in its ex-U.S. markets, with revenue reaching $502 million, a 24% increase, and adjusted EBITDA growing 62% to $121 million, with a 24% margin. Africa was a standout performer, growing 54% year-over-year, driven by markets like South Africa, Ghana, and the recent launch in Botswana. Europe grew 53%, with the UK up 87%, while Canada increased by 13%. APAC faced challenges, ending down 13% due to currency impacts and market closures. In the U.S., the iGaming sector showed improvement, with the EBITDA loss reducing from $11 million in Q4 2024 to $10 million in Q1 2025. Super Group is maintaining its fiscal year guidance of over $2 billion in revenue and $421 million in adjusted EBITDA, with ongoing opportunities for growth. The company ended the quarter with $351 million in unrestricted cash and no debt, and continues to focus on strategic investments and efficient marketing spend.Super Group (SGHC) Financial Statement Overview
Summary
Super Group (SGHC) demonstrates strong financial health with consistent revenue growth and robust cash flow generation. The company maintains a balanced capital structure with low leverage and increasing equity. Despite some fluctuations in net profit margins and rising liabilities, the overall financial position remains stable, supported by effective operational performance.Income Statement
The company's revenue has shown consistent growth over the years, with a strong increase in 2024 compared to 2023. The gross profit margin has remained healthy, indicating effective cost management. However, the net profit margin fluctuated, with a significant improvement in 2024 after a negative margin in 2023. The EBIT margin was zero in 2024, while the EBITDA margin improved, reflecting stronger operational performance before depreciation and amortization.78
Positive
Balance Sheet
The balance sheet shows a strong equity position with an increasing stockholders' equity over the years. The company has maintained a low debt-to-equity ratio, indicating conservative leverage. The equity ratio has improved, showing a solid capital structure. However, the total liabilities have increased, which could pose a potential risk if not managed properly.72
Positive
Cash Flow
The company's cash flow statements reflect robust operating cash flow growth, with free cash flow also showing a healthy upward trend. The operating cash flow to net income ratio is strong, indicating efficient cash generation from operations. The free cash flow to net income ratio is solid, highlighting effective cash management strategies.80
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.51B | 1.70B | 1.44B | 1.29B | 1.32B | 908.02M |
| Gross Profit | 690.88M | 841.42M | 666.28M | 848.66M | 424.16M | 610.09M |
| EBITDA | 103.95M | 272.59M | 101.69M | 189.09M | 315.84M | 178.78M |
| Net Income | 5.66M | 117.69M | -10.55M | 181.44M | 235.88M | 149.22M |
Balance Sheet | ||||||
| Total Assets | 828.08M | 1.05B | 960.87M | 877.00M | 844.07M | 551.15M |
| Cash, Cash Equivalents and Short-Term Investments | 272.68M | 401.73M | 241.92M | 254.78M | 293.80M | 138.54M |
| Total Debt | 19.57M | 70.40M | 29.23M | 18.46M | 20.02M | 219.79M |
| Total Liabilities | 723.42M | 517.21M | 422.08M | 342.35M | 330.02M | 480.28M |
| Stockholders Equity | 104.66M | 557.53M | 520.32M | 518.08M | 514.05M | 70.87M |
Cash Flow | ||||||
| Free Cash Flow | 0.00 | 191.84M | 79.30M | 139.30M | 183.10M | 139.21M |
| Operating Cash Flow | 0.00 | 295.09M | 132.85M | 166.84M | 209.85M | 151.32M |
| Investing Cash Flow | 0.00 | -105.79M | -5.01M | -96.52M | -18.16M | -5.84M |
| Financing Cash Flow | 0.00 | -54.15M | -131.16M | -103.18M | -39.76M | -81.09M |
Super Group (SGHC) Technical Analysis
Positive
10.91
Price Trends
8.91
Positive
8.05
Positive
6.69
Positive
Market Momentum
0.60
Negative
77.78
Negative
90.15
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SGHC, the sentiment is Positive. The current price of 10.91 is above the 20-day moving average (MA) of 9.72, above the 50-day MA of 8.91, and above the 200-day MA of 6.69, indicating a bullish trend. The MACD of 0.60 indicates Negative momentum. The RSI at 77.78 is Negative, neither overbought nor oversold. The STOCH value of 90.15 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SGHC.
Super Group (SGHC) Risk Analysis
Super Group (SGHC) disclosed 81 risk factors in its most recent earnings report. Super Group (SGHC) reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Super Group (SGHC) Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $5.47B | 39.46 | 21.19% | 1.46% | 22.80% | 281.38% | |
75 Outperform | $3.18B | 10.94 | 1.33% | 5.06% | -33.50% | 35.81% | |
72 Outperform | $5.68B | 23.54 | 81.59% | 1.92% | 9.48% | -11.92% | |
72 Outperform | $3.37B | 192.51 | 11.87% | ― | 29.86% | ― | |
65 Neutral | $38.14B | ― | -46.78% | ― | 22.86% | 30.40% | |
62 Neutral | $16.65B | 11.16 | -7.38% | 3.11% | 1.59% | -23.30% | |
61 Neutral | $2.75B | ― | -2.81% | ― | 5.51% | 92.46% |
* Consumer Cyclical Sector Average
Performance Comparison
SGHC
Super Group (SGHC)
10.91
7.87
258.88%
IGT
International Game Technology
16.29
-2.82
-14.76%
PENN
Penn National Gaming
18.24
-0.50
-2.67%
RRR
Red Rock Resorts
53.50
1.50
2.88%
DKNG
DraftKings
41.99
4.55
12.15%
RSI
Rush Street Interactive
14.90
5.77
63.20%
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.