Since some good years now there were many posts about evolution ab, which was trading at very reasonable valuation with good growth.
The stock has moved only one direction, and growth has gone negative, most bullish substacks sold their shares, and nobody cares anymore.
I think it’s the moment to revisit the thesis, since the price, although higher than it used to be, is still highly attractive.
The biggest problem is europe, where regulation basically now means soft ban. Players have to be anal probed every time they want to place a bet, the betting limits are laughably low, any advertising is almost completely restricted, not to mention the insane german laws being passed around in the space where everyone that lost at online gambling can get a refund while the anyone that made money can keep them.
I think things are looking up for evolution though, to some extent.
The biggest is fx. After q1 25, the usd plummeted and it’s been somewhat stable since then.
So with q2, that headwind disappears, meaning a 4-5% tailwind vs q1.
Latam + usa are growing well, and I think will be able to offset the europe losses.
They are buying back 0.3-0.5% of shares per week, a very brisk pace.
The usa expansion is kneecapped, I think that the bad news of the galaxy buyout falling off will present an even better buying opportunity rhan now. Management said basically that they will not comply with the requirements for vegas (getting our of india). I’m sure vegas sees them as a massive threat (which they are), some serious lobbying is probably going on to stop them from getting that license.