Genius Sports stock price target raised to $12 by Benchmark

Tuesday, Genius Sports Ltd. (NYSE:GENI) received a vote of confidence from Benchmark, as the firm’s analyst Mike Hickey increased the price target on the company’s shares to $12.00, maintaining a Buy rating. The revised target reflects a positive outlook based on the company’s recent financial performance and future growth potential. According to InvestingPro data, analyst targets for GENI range from $10 to $14, with the stock showing significant momentum, gaining nearly 15% over the past six months despite its characteristic volatility (Beta of 2.15).

Genius Sports reported a strong quarter, surpassing revenue and AEBITDA guidance while also generating positive free cash flow. The company’s U.S. business experienced a significant 51% revenue growth year-over-year in the fourth quarter, a result attributed to successful contract renewals. This momentum aligns with InvestingPro data showing an impressive 18.25% revenue growth over the last twelve months, reaching $462.5 million. This growth occurred despite facing an exceptionally challenging NFL betting market, where consumer-favorable sports outcomes negatively impacted sportsbooks, leading to poor earnings reviews for leading market players in the U.S.

The company has set an ambitious goal for 2025, projecting over 20% revenue growth coupled with a 46% increase in AEBITDA and margin expansion. These targets substantially exceed current market expectations. Genius Sports has demonstrated a consistent ability to outperform their guidance, and the management’s increased precision in their 2025 forecast is due to improved contract visibility and a stable revenue base, suggesting there may be additional room for growth. InvestingPro analysis reveals the company maintains strong liquidity with a current ratio of 1.5 and holds more cash than debt on its balance sheet, providing financial flexibility to pursue these growth targets.

Benchmark’s report also highlights Genius Sports’ reaffirmation of their medium-term outlook, which anticipates sustained revenue growth of over 20% beyond 2025. This projection is seen as a reinforcement of the company’s potential for continued expansion. With a strong balance sheet featuring $280 million in pro-forma cash, Genius Sports is well-positioned to make strategic investments and consider opportunistic acquisitions.

The company’s exceptional financial trajectory and strategic execution underpin Benchmark’s endorsement of Genius Sports as a "Top Idea." The new $12 price target is backed by the belief that sustained expansion in betting, media, and sports technology sectors will drive continued momentum for Genius Sports’ stock.

In other recent news, Genius Sports Ltd reported its Q4 2024 earnings, showing a notable revenue increase despite missing EPS expectations. The company posted a revenue of $176 million, surpassing the forecasted $175.72 million, marking a 38% year-on-year growth. However, the earnings per share came in at -$0.12, missing the forecast of $0.01. The company’s adjusted EBITDA increased 2.5 times year-on-year to $32 million, and it achieved its first year of positive net cash flow with $82 million in operating cash flow. Looking ahead, Genius Sports has provided strong guidance for 2025, projecting over 20% revenue growth and an adjusted EBITDA increase of 46% to $125 million. The company highlighted new product innovations and strategic management hires as part of its growth strategy. Additionally, Genius Sports plans to expand its BetVision product and focus on technology development and strategic mergers and acquisitions. These developments reflect the company’s ongoing efforts to strengthen its position in the sports technology and betting markets.

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