Bragg Gaming price target chopped at Haywood

Haywood Capital Markets analyst Gianluca Tucci maintained his “Buy” rating on Bragg Gaming Group (Bragg Gaming Group Stock Quote, Chart, News, Analysts, Financials TSX:BRAG) but cut his target price to C$7.50 from C$9.00 in an Aug. 14 research note, citing a softer outlook tied to international market weakness.

Tucci said the company’s Q2 2025 results were light and full-year guidance now points to mid-single-digit revenue growth, reflecting challenges in core markets such as the Netherlands — where higher gaming taxes and market softness are pressuring results — as well as headwinds in Brazil.

“In the face of these market challenges, BRAG notes it has realized €2-million in synergies, unlocking margins in H2/25,” Tucci said. “The company stresses it is prioritizing margin and cash flow performance over aggressive revenue expansion.”

He added that results and guidance were disappointing and largely outside the company’s control, and noted Bragg ended Q2 2025 with $2.3-million in net debt.

The Netherlands’ recent gambling tax hike, intended to generate an additional €200-million annually, has instead produced a €200-million revenue shortfall compared to last year. Gross gaming revenue for licensed operators fell 25% year over year in the first half of 2025, and tax collections reached only 83% of 2024 levels despite the rate increasing to 34.2% from 30.4%.

Bragg reported Q2 2025 revenue of €26.1-million and Adjusted EBITDA of €3.5-million, missing Tucci’s estimates of €28.1-million and €4.8-million, respectively. Gross margin was 52.7%, slightly below his 55.0% forecast but up from 49.9% a year earlier. Free cash flow was a €1.1-million drain, leaving closing cash at €4.2-million.

The company lowered its 2025 guidance to revenue of €106-million–€108.5-million from €117.5-million–€123-million previously, and Adjusted EBITDA of €16.5-million–€18.5-million from €19.0-million–€21.5-million. The company expects margin expansion in 2025 and beyond as revenue mix shifts toward higher-margin proprietary content.

Tucci said Bragg should do $16.9-million in Adjusted EBITDA on revenue of $107.3-million in fiscal 2025, improving to $18.0-million on $113.8-million in fiscal 2026.

He recommends investors continue to accumulate shares, saying: “We believe BRAG has a scalable B2B iGaming platform that should continue to grow in tandem with new market entrances, while penetrating deeper in existing, more mature overseas markets.”

-30-