{"id":186193,"date":"2021-09-19T06:00:21","date_gmt":"2021-09-19T13:00:21","guid":{"rendered":"https:\/\/www.casino.org\/news\/?p=186193"},"modified":"2021-09-19T12:29:29","modified_gmt":"2021-09-19T19:29:29","slug":"neogames-stock-is-slumping-but-analyst-sees-reasons-for-rebound","status":"publish","type":"post","link":"https:\/\/www.casino.org\/news\/neogames-stock-is-slumping-but-analyst-sees-reasons-for-rebound\/","title":{"rendered":"NeoGames Stock Decline Belies Potentially Favorable Setup"},"content":{"rendered":"

NeoGames (NASDAQ:NGMS) stock is down 10.65 percent over this month, and off 51 percent from its 52-week high. But at least one sell-side analyst is saying that selloff is a case of too much, too soon, and believes shares of the iLottery provider can bounce back.<\/p>\n

\"NeoGames
Tough comps in Michigan are weighing on NeoGames stock. An analyst says those concerns are overblown. (Image: WLNS 6 News<\/em>)<\/figcaption><\/figure>\n

In a recent note to clients, Stifel analyst Steven Wieczynski reiterates a \u201cbuy\u201d rating and a $71 price target on NeoGames. That’s nearly double the $36 handle at which the stock closed on Sept. 17.<\/p>\n

At this point, we think the selloff has created an extremely attractive buying opportunity for NGMS, and see a compelling setup into year-end, with several potential near-term catalysts coupled with likely upside to consensus estimates from improving SAH compares\/trends and impressive ramp cadence for recently launched contracts ,\u201d said Wieczynski.<\/p><\/blockquote>\n

Those catalysts include the possibility of more states considering <\/a>and perhaps approving internet lottery programs. As Wieczynski notes, Ohio’s legislature is in session, while NeoGames has a request for proposal (RFP) pending in Connecticut and a request for information (RFI) under consideration in West Virginia.<\/p>\n

NeoGames Stock Headwinds in Rear View Mirror<\/h2>\n

Shares of NeoGames are struggling since the Israeli gaming company announced second-quarter earnings over a month ago, which some analysts attribute to conservative guidance offered up by the operator.<\/p>\n

\n

Additionally, the stock was hit by news out earlier this month that Caesars Entertainment (NASDAQ:CZR) could sell up to 6.12 millions shares<\/a> of the iLottery company, trimming its stake to 12 percent from 24.5 percent. The casino giant inherited that stake via its $3.69 billion purchase of sportsbook operator William Hill.<\/p>\n<\/div>\n

Those factors are priced into NeoGames stock and now in the past, indicating there’s rebound potential into year-end, particularly as the company ramps up in states outside of Michigan — currently its marquee market.<\/p>\n

\u201cThere is still significant growth ahead for NGMS’s non-Michigan contracts. NGMS has done a tremendous job ramping penetration in New Hampshire and Virginia, with iLottery instants running ~40 percent of total instant sales after just ~2.5 and ~0.5 years, respectively – a feat which took MI ~5 years to accomplish,\u201d said the Stifel analyst.<\/strong><\/p>\n

In the US, NeoGames is also operational<\/a> in New Hampshire, North Carolina, and Virginia, and is pursuing iLottery contracts in Alaska, Connecticut, Maryland, Massachusetts, Missouri, Ohio, and Oregon. It also provides iLottery services in Alberta, Canada and some countries in Europe.<\/p>\n

Michigan Market Musings<\/h2>\n

With Michigan ranking as NeoGames’ largest market, the emergence of online casinos and sports betting there, coupled with tough comparisons, may be contributing to recent weakness in the gaming company’s shares. But investors may be overreacting to those factors.<\/p>\n

\u201cAfter analyzing the latest iLottery sales data from the state, we think the deceleration in Y\/Y growth is more just a function of NGMS finally lapping difficult compares from the stay-at-home tailwinds that benefited the broader online consumer beginning 4\/2020, vs. anything structural in nature,\u201d says Wieczynski.<\/strong><\/p>\n

The analyst adds Michigan iLottery sales are running about 100 percent ahead of last year’s levels, noting that investor fears regarding that state are overblown as it pertains to NeoGames stock.<\/p>\n","protected":false},"excerpt":{"rendered":"

NeoGames (NASDAQ:NGMS) stock is down 10.65 percent over this month, and off 51 percent from its 52-week high. But at least one sell-side analyst is saying that selloff is a case of too much, too soon, and believes shares of the iLottery provider can bounce back. In a recent note to clients, Stifel analyst Steven […]<\/p>\n","protected":false},"author":46,"featured_media":186194,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[10,13699],"tags":[],"acf":[],"yoast_head":"\nNeoGames Stock Is Slumping, But Analyst Sees Reasons for Rebound<\/title>\n<meta name=\"description\" content=\"NeoGames stock could be a rebound candidate as more states approve iLottery and as the Michigan story is understood.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.casino.org\/news\/neogames-stock-is-slumping-but-analyst-sees-reasons-for-rebound\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"NeoGames Stock Is Slumping, But Analyst Sees Reasons for Rebound\" \/>\n<meta property=\"og:description\" content=\"NeoGames stock could be a rebound candidate as more states approve iLottery and as the Michigan story is understood.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.casino.org\/news\/neogames-stock-is-slumping-but-analyst-sees-reasons-for-rebound\/\" \/>\n<meta property=\"og:site_name\" content=\"Casino.org\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/Casino.OrgNews\" \/>\n<meta property=\"article:published_time\" content=\"2021-09-19T13:00:21+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2021-09-19T19:29:29+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2021\/09\/NGMS2.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1920\" \/>\n\t<meta property=\"og:image:height\" content=\"1080\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Todd Shriber\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@etfgodfather\" \/>\n<meta name=\"twitter:site\" content=\"@Casino_Org\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Todd Shriber\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.casino.org\/news\/neogames-stock-is-slumping-but-analyst-sees-reasons-for-rebound\/\",\"url\":\"https:\/\/www.casino.org\/news\/neogames-stock-is-slumping-but-analyst-sees-reasons-for-rebound\/\",\"name\":\"NeoGames Stock Is Slumping, But Analyst Sees Reasons for Rebound\",\"isPartOf\":{\"@id\":\"https:\/\/www.casino.org\/news\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.casino.org\/news\/neogames-stock-is-slumping-but-analyst-sees-reasons-for-rebound\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.casino.org\/news\/neogames-stock-is-slumping-but-analyst-sees-reasons-for-rebound\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2021\/09\/NGMS2.jpg\",\"datePublished\":\"2021-09-19T13:00:21+00:00\",\"dateModified\":\"2021-09-19T19:29:29+00:00\",\"author\":{\"@id\":\"https:\/\/www.casino.org\/news\/#\/schema\/person\/f4cecf70a5032bc4e60eb73fc86d4a85\"},\"description\":\"NeoGames stock could be a rebound candidate as more states approve iLottery and as the Michigan story is understood.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.casino.org\/news\/neogames-stock-is-slumping-but-analyst-sees-reasons-for-rebound\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.casino.org\/news\/neogames-stock-is-slumping-but-analyst-sees-reasons-for-rebound\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.casino.org\/news\/neogames-stock-is-slumping-but-analyst-sees-reasons-for-rebound\/#primaryimage\",\"url\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2021\/09\/NGMS2.jpg\",\"contentUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2021\/09\/NGMS2.jpg\",\"width\":1920,\"height\":1080,\"caption\":\"Tough comps in Michigan are weighing on NeoGames stock. 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