SRAD: Share Buybacks And Core Segment Strength Will Drive Performance Ahead

Analysts have slightly lowered their average fair value estimate for Sportradar Group from $33.18 to $32.92, citing a muted growth outlook despite improvements in profit margin and revenue growth in recent quarters.

Analyst Commentary

Analysts have recently provided a range of perspectives on Sportradar Group's future outlook, citing both positives and potential concerns that could impact the company's valuation and growth trajectory.

Bullish Takeaways

• Bullish analysts highlight Sportradar’s leading position in the expanding sports data and technology sector. This is expected to support sustained revenue growth over the coming years.
• Updates to company models reflect optimism around rising guidance for 2025, which is driven by continued strength in Sportradar’s core business and the integration of new assets such as IMG Arena.
• Operational improvements, such as the roll-out of new product offerings and technology enhancements, are seen as effective in supporting gaming margins and creating new revenue opportunities.
• Recent share price weakness is viewed by some as an attractive entry point, as expectations are that the market is overly discounting the company's muted near-term outlook.

Bearish Takeaways

• Bearish analysts note that while profit margins have improved, the overall growth outlook remains subdued. This has prompted a modest reduction in fair value estimates and price targets.
• There is caution around the near-term performance of Sportradar’s media segment. Traction in new business lines may take time to translate into meaningful financial results.
• Recent quarterly results were described as unspectacular, which suggests that current execution may not yet fully justify more aggressive growth assumptions.

What's in the News

• The Bear Cave issued a cautious report on Sportradar, stating that investors may overestimate Sportradar's business quality and competitive moat, while underestimating growing competition and headwinds from prediction markets. The report also explored allegations related to the company's role in policing and potentially facilitating problematic gambling activity. (The Bear Cave)
• Cboe Global announced plans to launch its own prediction markets offering within months, intentionally avoiding sports-related products for now. This highlights increased competition in the prediction market sector involving regulated event contracts, with Sportradar listed among key industry players. (Bloomberg)
• Underdog became the first U.S.-based operator to incorporate Bettor Sense, Sportradar’s AI-powered responsible gaming solution designed to identify high-risk players and enable early interventions through partnerships with care providers like Birches Health. (Company announcement)
• Sportradar raised its earnings guidance for fiscal 2025, projecting revenue of at least €1,290 million. This would represent year-on-year growth of at least 17 percent. (Company guidance)
• The company increased its equity buyback authorization by $100 million in October 2025. This brings the total program size to $300 million. (Company announcement)

Valuation Changes

• Consensus Analyst Price Target: The average fair value estimate has fallen slightly, from $33.18 to $32.92.
• Discount Rate: Increased marginally, moving from 7.79% to 7.80%.
• Revenue Growth: The projected revenue growth rate has risen modestly, from 17.10% to 17.71%.
• Net Profit Margin: Improved, increasing from 14.65% to 15.81%.
• Future P/E: The expected price-to-earnings ratio for future earnings has declined, from 36.88x to 34.01x.