GENI - Genius Sports: Be On The Bench Too Many Concerns
2024-07-14 14:15:24 ET
Summary
- Genius Sports showed strong Q1 2024 results, with revenue exceeding expectations and margins improving.
- There are concerns about exclusive multi-year deals with sports leagues impacting profitability and stock price.
- Technology is not a differentiating factor in an industry that is not very attractive.
- Valuation estimates $6.6 per share, with risks including margin expansion and cash management affecting value.
Overview
Genius Sports ( GENI ) showed strong revenue growth in Q1 2024, as has been the case in the last few years. Q4 revenue exceeded expectations with $120 million, a 23% year-on-year increase. Growth was produced in all segments. The company also surpassed expectations in Adjusted EBITDA, achieving $7 million from a $13 million loss for the entire 2023 year. In Figure 1, you can see how the evolution has been trending upwards....
Genius Sports: Be On The Bench, Too Many Concerns