888 Holdings may have the final laugh with regard to the takeover of online gambling company Bwin.party, but if it doesn’t, its online strategy could come under deeper scrutiny.
Then, it may have to invest more in its own online platforms, in our view.
Takeover Saga
Press reports this week suggest that its rival GVC Holdings “would consider going hostile in its takeover bid for larger target Bwin should the latter decide to go with a rival offer from 888 Holdings.”
The latest official news on this hot topic emerged in early September: “further to its announcement on 27 August regarding a proposal from GVC Holdings, the board of Bwin confirms it has also now received a revised proposal from 888 Holdings plc. This revised proposal is subject to a number of pre-conditions (which can be waived in whole or in part by 888).”
So, 888 is in the driving seat.
SEO Audit
888 defines itself as “one of the world’s most popular online gaming entertainment and solutions providers.”
Its corporate website 888holdingsplc.com is essentially an empty box, which is not usual, but its 888 Casino online platform provides a good proxy for its online strategy — the casino unit represents about 50% of group revenues.
Of course, 888 is paying attention to the regulatory framework of online gaming, which “is dynamic and complex,” as the group says, but that’s not enough. Our preliminary SEO audit points to several issues with some key performance metrics, which affect returns.
Many of its online features are rather disappointing and do not live up to expectations for a company with a $915m market cap. Why so?
To learn more about our findings, please download the SEO audit that will be released later today.
Value
Uncertainty reigns, and it will likely take some time before we know how this story is going to end.
What’s known, though, is that if you are willing to add exposure to 888 Holdings right now, you’d have to be prepared to pay about 20x forward earnings and over 12x forward adjusted operating cash flow for the shares of a company whose forward operating margin is projected at between 13% and 14%, and whose trailing growth rate is rather appealing — but whose growth forecasts are less enticing.
If you want to learn more about our actionable SEO leads for 888 Holdings, please contact our team at: info@hedgingbeta.com.
(Alessandro Pasetti and Hedging Beta are not invested in any of the shares mentioned in this article.)