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On Wednesday, Craig-Hallum analyst Ryan Sigdahl increased the price target on Genius Sports Ltd. (NYSE:GENI) shares to $15.00, up from the previous $14.00, while reiterating a Buy rating for the company. The new target represents a significant upside from the current trading price of $9.38. Sigdahl expressed confidence in the company’s future, citing management’s introduction of 2025 guidance that surpassed expectations due to a combination of growth in online sports betting (OSB), pricing benefits, and the introduction of new products. According to InvestingPro data, analyst consensus remains strongly bullish, with targets ranging from $11 to $15.
Genius Sports, according to the analyst, has the unique position of being the only business-to-business (B2B) supplier capable of raising prices on its US and international customers during the fourth quarter. This pricing power is a significant factor contributing to the company’s robust financial outlook, reflected in its impressive revenue growth of 23.71% over the last twelve months. Additionally, an increased mix of in-play betting in the US market and the high demand for new products, such as FANHub and BetVision, are seen as positive indicators for the company’s growth trajectory. InvestingPro data shows the company maintains a strong financial position, with liquid assets exceeding short-term obligations and minimal debt on its balance sheet.
Sigdahl emphasized that Genius Sports is more than just a data intermediary. Instead, the company is a critical data provider and sports technology innovator with advanced computer vision and artificial intelligence technology. The addition of new advertising technology capabilities through FANHub and its self-service demand-side platform (DSP) further strengthens its market position.
The analyst’s high conviction in Genius Sports is rooted in what he describes as the company’s structural advantages and an accelerating flywheel effect, which refers to the self-reinforcing cycle of growth that the company appears to be experiencing. This, combined with an attractive financial profile, underpins the rationale for the increased price target and the continued Buy rating.
In other recent news, Genius Sports Ltd. reported its fourth-quarter 2024 earnings, revealing a revenue of $176 million, slightly above the expected $175.72 million, despite missing earnings per share (EPS) expectations with an actual EPS of -$0.12 against a forecast of $0.01. The company demonstrated significant growth with a 38% year-on-year increase in revenue and a 2.5x rise in adjusted EBITDA, reaching $32 million. For fiscal year 2025, Genius Sports projects a 21% revenue increase and an adjusted EBITDA of $125 million, both surpassing Wall Street expectations. Goldman Sachs raised its price target for Genius Sports shares to $12.50, maintaining a Buy rating, while Benchmark also increased its target to $12.00, reflecting confidence in the company’s growth potential. Genius Sports saw a 51% year-over-year revenue growth in its U.S. business during the fourth quarter, attributed to successful contract renewals. The company also raised $144 million in a public offering, strengthening its balance sheet for potential mergers and acquisitions. Management plans to expand its BetVision product into global sports, including soccer and basketball, in 2025.
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