The share price of the FTSE 100-listed Entain PLC (GB:ENT) fell by around 12% today after the company lowered its net gaming revenue (NGR) forecast for its third quarter and full year of FY23. The company stated that the NGR will be impacted due to sports betting results falling below expectations. The company also attributed this adjustment to the continued aftereffects of gambling measures and regulatory challenges, especially in the UK.
The investors reacted negatively to the news, and the Entain share price went down by 12.02% on Monday at the time of writing. Overall, the stock has been trading down by 30% year-to-date.
Entain is a multinational gaming and sports betting corporation that operates in approximately 20 countries. The company’s brand portfolio includes Bwin, Coral, Ladbrokes, Partypoker, Partycasino, and others.
Net Gaming Revenue Downgrade
Today, the company delivered an update on its trading status and offered guidance for FY23 online NGR. Post-summer, the online NGR results have varied within the group, but, on the whole, they have been less robust than initially anticipated. As for Q3, online NGR growth is now projected to increase by a high single-digit percentage, and it is expected to decline by a high single-digit percentage on a pro forma basis.
For the full year, the company’s online NGR is expected to grow by a low double-digit percentage. The company maintained its projections for FY23 EBITDA to fall within the range of £1.00 billion to £1.05 billion, thanks to effective operational controls.
In the long term, the company is confident about its strategic transformation and expects to deliver higher shareholder value, driven by huge demand and upcoming product developments.
Is Entain a Good Stock to Buy?
Despite the lower forecasted numbers, analyst James Wheatcroft from Jefferies reiterated his Buy rating on the stock today. His price target of 1,460p implies an upside of over 55% in the share price.
Overall, analysts hold a bullish view regarding ENT stock, as evidenced by its Strong Buy rating on TipRanks. This includes eight Buy and one Hold recommendations. The Entain share price prediction is 1,686.1p, which is higher than the current trading levels and implies a huge upside of 81%.
