LSE:888

Stock Analysis Report

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Market Cap

UK£1.4b

Last Updated

2021/07/27 22:08 UTC

Data Sources

Company Financials +

Executive Summary

888 Holdings plc, together with its subsidiaries, provides online betting and gaming products and solutions. More Details


Snowflake Analysis

High growth potential with excellent balance sheet.


Similar Companies

Share Price & News

How has 888 Holdings's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 888 is not significantly more volatile than the rest of UK stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: 888's weekly volatility (4%) has been stable over the past year.


Market Performance


7 Day Return

4.3%

888

5.0%

GB Hospitality

2.0%

GB Market


1 Year Return

97.8%

888

55.4%

GB Hospitality

18.4%

GB Market

Return vs Industry: 888 exceeded the UK Hospitality industry which returned 55.3% over the past year.

Return vs Market: 888 exceeded the UK Market which returned 19.1% over the past year.


Shareholder returns

888IndustryMarket
7 Day4.3%5.0%2.0%
30 Day-5.2%-2.2%-1.1%
90 Day-17.6%-4.8%1.1%
1 Year105.7%97.8%55.7%55.4%23.7%18.4%
3 Year69.0%48.7%7.6%0.3%11.1%-1.6%
5 Year112.0%68.6%25.9%8.4%41.7%14.4%

Long-Term Price Volatility Vs. Market

How volatile is 888 Holdings's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is 888 Holdings undervalued compared to its fair value and its price relative to the market?

25.4%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 888 (£3.71) is trading below our estimate of fair value (£4.97)

Significantly Below Fair Value: 888 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 888 is poor value based on its PE Ratio (167.8x) compared to the UK Hospitality industry average (30.8x).

PE vs Market: 888 is poor value based on its PE Ratio (167.8x) compared to the UK market (23.8x).


Price to Earnings Growth Ratio

PEG Ratio: 888 is poor value based on its PEG Ratio (4.2x)


Price to Book Ratio

PB vs Industry: 888 is overvalued based on its PB Ratio (12.6x) compared to the GB Hospitality industry average (2.4x).


Future Growth

How is 888 Holdings forecast to perform in the next 1 to 3 years based on estimates from 9 analysts?

40.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 888's forecast earnings growth (40.3% per year) is above the savings rate (0.9%).

Earnings vs Market: 888's earnings (40.3% per year) are forecast to grow faster than the UK market (16.9% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: 888's revenue (6.3% per year) is forecast to grow faster than the UK market (5.3% per year).

High Growth Revenue: 888's revenue (6.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 888's Return on Equity is forecast to be very high in 3 years time (40.2%).


Past Performance

How has 888 Holdings performed over the past 5 years?

9.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 888 has a large one-off loss of $78.2M impacting its December 31 2020 financial results.

Growing Profit Margin: 888's current net profit margins (1.3%) are lower than last year (7.4%).


Past Earnings Growth Analysis

Earnings Trend: 888's earnings have grown by 9.2% per year over the past 5 years.

Accelerating Growth: 888's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 888 had negative earnings growth (-72.9%) over the past year, making it difficult to compare to the Hospitality industry average (6.1%).


Return on Equity

High ROE: 888's Return on Equity (7.5%) is considered low.


Financial Health

How is 888 Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: 888's short term assets ($274.6M) do not cover its short term liabilities ($298.9M).

Long Term Liabilities: 888's short term assets ($274.6M) exceed its long term liabilities ($37.4M).


Debt to Equity History and Analysis

Debt Level: 888 is debt free.

Reducing Debt: 888 had no debt 5 years ago.

Debt Coverage: 888 has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: 888 has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet


Dividend

What is 888 Holdings's current dividend yield, its reliability and sustainability?

2.64%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: 888's dividend (2.64%) is higher than the bottom 25% of dividend payers in the UK market (1.3%).

High Dividend: 888's dividend (2.64%) is low compared to the top 25% of dividend payers in the UK market (3.98%).


Stability and Growth of Payments

Stable Dividend: 888 has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: 888's dividend payments have increased, but the company has only paid a dividend for 9 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (443.6%), 888's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 888's dividends in 3 years are forecast to be covered by earnings (51.5% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

1.5yrs

Average management tenure


CEO

Itai Pazner (48 yo)

2.5yrs

Tenure

US$2,567,000

Compensation

Mr. Itai Pazner has been Chief Executive Officer of 888 Holdings plc since January 24, 2019 and served its Chief Operating Officer since October 2017 until January 24, 2019. Mr. Pazner has been an Executiv...


CEO Compensation Analysis

Compensation vs Market: Itai's total compensation ($USD2.57M) is above average for companies of similar size in the UK market ($USD1.37M).

Compensation vs Earnings: Itai's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

Experienced Management: 888's management team is not considered experienced ( 1.5 years average tenure), which suggests a new team.


Board Members

Experienced Board: 888's board of directors are not considered experienced ( 0.8 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: 888 insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

888 Holdings plc's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: 888 Holdings plc
  • Ticker: 888
  • Exchange: LSE
  • Founded: 1997
  • Industry: Casinos and Gaming
  • Sector: Consumer Services
  • Market Cap: UK£1.379b
  • Shares outstanding: 372.01m
  • Website: https://corporate.888.com

Number of Employees


Location

  • 888 Holdings plc
  • Europort
  • Suite 601/701
  • Gibraltar
  • Gibraltar

Listings


Biography

888 Holdings plc, together with its subsidiaries, provides online betting and gaming products and solutions. It operates through Business to Customer and Business to Business segments. The company owns pro...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/07/27 22:08
End of Day Share Price2021/07/27 00:00
Earnings2020/12/31
Annual Earnings2020/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.