The average target price of GAMB is 20 and suggests 60% upside potential. Usually, this means a BUY recommendation among investment firms, or a recommendation to increase one's position in this instrument in the next 12 months. The most optimistic analyst has a target price of 21.0. This translates into 70% upside potential in the best case. On the other hand, the most pessimistic analyst has a target price of 17.0. This suggests 38% upside potential. Even the most pessimistic analyst believes there will be stock growth. 

Gambling.com Group Limited operates as a performance marketing company for the online gambling industry worldwide. The company provides digital marketing services for the iGaming and sports betting. It publishes various branded websites, including Gambling.com and Bookies.com. Gambling.com Group Limited was incorporated in 2006 and is based in St. Helier, Jersey.

Jersey

Gambling.com Group Limited

Consumer Cyclical

The company does not pay dividends at all, or it pays them sporadically. There have only been a few years with dividend payments in the past ten years. 

GAMB reported revenue of USD 127mn in the last 12 months, up 17% from FY23. At the same time, the dynamics of cash flow, as measured by free cash flow (FCF), were drastically different. EPS grew 76% from FY23 to USD 0.86. Market expects EPS to reach USD 0.87 in FY25.

The stock's performance has been mixed in the past six months, with growth following a decline. There is no clear price trend compared to its global peers from the same sector and industry (as shown above). The stock has outperformed this peer group by 9ppts over past six months and grown 0ppts faster in the past month. This is largely true for peers from the same country and sector. With respect to the stock's valuation against its peers, its overall price performance is neutral.

The company has reported good EBITDA margins compared to its global peers in recent years. EBITDA margin amounted to 32.8% in the last 12 months, up from 21.7% in FY23. 

Historically, GAMB has reported very strong net margins compared to its global peers. Specifically, in the last 12 months, this metric equalled 24.1%, a growth from 16.8% in FY23. 

In the last 12 months, the return on capital employed (RoCE) grew to 22.6%, above the peers. The consensus estimate for FY24 for RoCE is 27.7%, again ahead of the peers. 

Gambling.com Group Limited reported a return on equity (RoE) of 25.3% in the last 12 months, up from 17.7% in FY23. The market consensus projects an RoE of 24.1% in FY24, again ahead of its peers. 

Another important profitability metric, return on assets (RoA), amounted to 18.4% in the last 12 months, an increase from 12.4% in FY23. The market analysts predict that RoA will be 18.5% in FY24, again stronger than its peers. 

The ratio of return on invested capital (RoIC) to the weighted average cost of capital (WACC) has been 2.0 in the past several years. This ratio implies a strong shareholder value creation. 

The institutional, legal, and compliance risks associated with the company's country are moderate. In combination with weak business standards, only average protection of shareholder rights is ensured.

GAMB has average trading liquidity. The average private investor can sell his common position in the stock almost immediately. Liquidity is usually stable and is somewhat unfavourable on the days with the lowest activity. The trading volume mostly stays the same even under highly turbulent market conditions. The stock has a small market capitalisation, which usually makes its trading liquidity erratic and unpredictable. 

No other major risks have been identified.

The risk of default is very high. Among the negative credit factors, we point to excessive margin volatility.

In highly turbulent market conditions, GAMB is highly volatile. In other words, the stock will fall substantially more than the index in times of extreme market volatility or shocking company news. Standalone, the worst-day losses (less than 1% of the time) will likely be significant. 

In normal market circumstances, GAMB is exceptionally volatile. Put differently, without outstanding market volatility or shocking company news, the stock's price will change quite unpredictably. The stock's losses on its worst days (less than 1-5% of the time) will range from critical to immense. 

Considering past and projected metrics, the stock is neither 'expensive' nor 'cheap' compared to its peers. In particular, the stock is reasonably priced on P/E, of fair value on EV/EBITDA, trading at neutral levels on P/FCF. 

Gambling.com Group Limited

$ 12.48

3

Gambling.com Group Limited

$ 12.48

3

Risk factor

Profitability factor

Risk / Profitability

Risk factor

Profitability factor

$ 12.48

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