theScore (TSXV:SCR) has had a good run but there could be much more upside to come, says Euro Pacific Canada analyst Rob Goff.
In a research update to clients this morning, Goff maintained his “Buy” rating and one-year target of $0.85 on theScore.
Goff previewed theScore’s Q2,2015 results. The analyst expects the company will generate an EBITDA loss of $2.51-million on revenue of $2.69-million in the quarter, slightly more pessimistic than the consensus of an EBITDA loss of $2.02-million on a $2.92-million topline.
Shares of theScore have more than doubled since December, but Goff thinks the company could just be scratching the surface.
“We maintain our bullish stance,” he said. “Despite the 42.6%, 108.1% YTD and y/y gains, we see aggressive upside extending beyond our current $0.85 PT. Our current PT significantly discounts the upside potential from the fantasy sports gambling and eSports categories. We expect to revise longer-term forecasts upwards and review our PT with greater details on both new categories”.
Goff says the growth of fantasy sports is reflected in the recent success of FanDuel and Draft Kings. He believes theScore’s recent acquisition Swoopt is a legitimate entry in this field because the company has the ability to cross-promote the offering to its more than ten-million users.
theScore acquired Swoopt, which offers daily fantasy sports contests for professional baseball, hockey, football, basketball and college football, in December.