Cantor Fitzgerald analyst Tom Liston says he has increasing confidence in Amaya Gaming’s (TSXV:AYA) prospects.
Liston attended the Global iGaming Summit and Expo (GiGse) in San Francisco this week, of which Amaya Gaming was the lead sponsor.
After speaking with network with industry leaders, regulators and research/compliance experts, Liston says he came away feeling more bullish about Amaya’s opportunity, as individual states begin to regulate online gaming.
Liston says this recent acquisition of Cadillac Jack could be a real boon to Amaya because its team has significant experience with industry heavyweights, and its Class III slot machines open up significant opportunities to accelerate growth. In a research update to clients this morning, Liston maintained his BUY recommendation, but raised his one-year price target on Amaya by fifty cents, to $8.00.
Amaya will report its Q4, 2012 results on Monday, April 29th, after the close of the market. Liston says he expects the company will beat consensus estimates on both the top and bottom lines. He thinks Amaya will generate EBITDA of $13.4-million on revenue of $36.3-million, versus consensus estimates of a $12-million bottom line on $33.7-million in revenue.
In February of last year, two California senators introduced draft legislation to regulate online gaming in the United States The proposed bill, called the The Internet Gambling Consumer Protection and Public-Private Partnership Act of 2012 would generate tax revenue for the state by doing things like taxing internet poker at a rate of 10% of gross revenue. Liston says Amaya’s four most recent acquisitions, Chartwell, CryptoLogic, Ongame and Cadillac Jack, are highly strategic and place the company in a solid position to benefit from gambling regulation opening up in the United States.
Shares of Amaya Gaming closed today up 6.3% to $5.55.