NYX Gaming is undervalued, says Cantor Fitzgerald Canada

NYX Gaming (NYX Gaming Stock Quote, Chart, News: TSXV:NYX) is the new kid on the online gaming block, but investors should pay attention to it, says Cantor Fitzgerald Canada analyst Ralph Garcea.

In a research report to clients this morning, Garcea initiated coverage of NYX Gaming with a “Buy” rating and a one-year target of $7.00, implying a return of 47.4% at the time of publication.

Garcea notes that NYX Gaming’s platform boasts more than 350 proprietary and more than 550 third-party supplied lottery, bingo and casino products. The analyst likes that more than 90% of the company’s revenue is recurring, that it has a “blue chip” customer base, and that its management has deep M&A experience.

“NYX’s open technology platform and partnerships with leading content providers and 30+ payment processors, provides flexibility in game content delivery, payment processing, geolocation technology, fraud prevention, affiliate management, and business analytical tools, allowing its customers to respond to market changes and select products and services that directly address their evolving needs,” said Garcea.

NYX began trading on the Toronto Venture Exchange on December 30th by raising $20-million at an initial price of $3.50. As part of the IPO process, NYX acquired Ongame Network from Amaya Gaming.

Garcea thinks NYX will generate revenue of $26.56-million in fiscal 2014, a number he sees climbing to $36.69-million the following year.

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