Hansen, Mueller Industries director, sells $105,710 in stock
Investing.com -- J.P. Morgan downgraded Swedish gaming technology company Evolution Gaming (OTC:EVVTY) to “underweight,” setting a new price target of 675 SEK, reflecting roughly a 10% downside from current levels.
The brokerage cited a reset in the company’s growth and margin profile as the main driver for the rating change.
The analysts flagged expectations of a structurally lower growth trajectory in the coming years, which it said is not fully captured in consensus estimates that still imply a material acceleration in underlying growth from fiscal year 2026 onwards.
J.P. Morgan pointed to ongoing challenges in Asia and Europe that are affecting Evolution Gaming’s revenue growth and are unlikely to dissipate in the near term.
As a result, the brokerage cut its revenue and EBITDA estimates by approximately 5% for FY26 and beyond.
These revised estimates are now about 8% below Bloomberg consensus for revenue and 11% below consensus for EBITDA in the outer years.
The brokerage values Evolution Gaming on a sum-of-the-parts basis, implying a one-year forward target multiple of around 7x, compared with the current multiple of roughly 9.5x.
J.P. Morgan said the lower multiple is justified given the ongoing growth and margin reset amid regulatory pressures.
The brokerage also noted a bear-case scenario suggesting a 30% downside potential from the current share price.