GAN - GAN Limited tumbles after announcing strategic review is in place

2023-03-31 10:57:44 ET

Gan Limited ( NASDAQ: GAN ) fell sharply in morning trading on Friday after the company fell short of expectations with its Q4 earnings report and announced it has initiated a strategic review process.

The board plans to assess a range of strategic alternatives to maximize shareholder value. Due to the strategic review, GAN held back on issuing any full-year guidance. However, GAN said it plans to address its liquidity needs by taking steps to improve its operations and cash position. Those steps include identifying access to future capital, continued growth from consolidated operations, cost savings initiatives, as well as the strategic review process.

Macquarie analyst Chad Beynon believes a potential GAN transaction is likely the firmest path to maximizing shareholder value at this point due to the costs of trying to grow market share.

"Outside of the search for strategic alternatives, we still believe GAN has strong tech and content, but argue GAN needs to return to double-digit revenue growth, announce more meaningful deals, or be exposed to more iGaming legislation to attract investor attention."

Shares of GAN fell 21.75% in Friday morning trading to $1.33 and swapped hands very close to the 52-week low of $1.20.

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