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Investing.com - Goldman Sachs has lowered its price target on Playtika Holding Corp . (NASDAQ:PLTK) to $4.50 from $5.25 while maintaining a Neutral rating on the stock. According to InvestingPro analysis, the stock is currently trading near its 52-week low of $3.66, with shares down over 43% in the past six months. Despite the recent decline, InvestingPro’s Fair Value analysis suggests the stock may be undervalued at current levels.
The adjustment follows Playtika’s second-quarter 2025 results, which fell below both Goldman Sachs and Street estimates for revenue and Credit Adjusted EBITDA. While the company maintains strong fundamentals with a gross profit margin of 72.3% and an EV/EBITDA ratio of 5.68x, the underperformance was primarily driven by continued declines in the company’s Slotomania game, which saw revenue drop 23% quarter-over-quarter.
Despite the disappointing results from Slotomania, Playtika reported strength in recently acquired titles, particularly highlighting the successful launch of Disney (NYSE:DIS) Solitaire. The new game has already achieved a $100 million annual revenue run-rate, according to management statements during the earnings call.
Playtika management has increased its focus on the Direct-to-Consumer (D2C) platform, raising the long-term target from 30% to 40% of total revenue. This strategic shift aims to help offset margin pressure resulting from the ongoing portfolio transition.
Goldman Sachs expects investor debates to center around social casino title performance, momentum sustainability at Disney Solitaire and the broader SuperPlay portfolio, and capital allocation priorities including organic growth investments, mergers and acquisitions, and shareholder returns.
In other recent news, Playtika Holding Corp. reported second-quarter earnings that did not meet analyst expectations. The company posted adjusted earnings of $0.09 per share, significantly missing the consensus estimate of $0.19. Revenue for the quarter was $696 million, falling short of the anticipated $705.4 million, although it did mark an 11% increase compared to the previous year. Following these results, Wedbush lowered its price target for Playtika to $7 from $11.50, while maintaining an Outperform rating. The firm noted that Playtika’s revenue was roughly in line with expectations, but EBITDA was below forecasts. Additionally, Playtika has revised its full-year revenue guidance downward, although it maintained its EBITDA outlook for the year. These developments highlight the company’s struggles with declining performance in key titles.
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