Playtech’s share price fails to reflect the true value of its investment portfolio, according to analysts at Peel Hunt, which has upgraded its target price for the gambling technology supplier from £5.10 to £6.90.
The investment house maintained its Buy rating on the stock, arguing that Playtech operates more as an investment vehicle for the gambling sector than a pure technology company.
Analysts Ivor Jones and Douglas Jack said the potential embedded in the firm’s investment portfolio is underappreciated, while risks to its core operating business drag disproportionately on the share price.
The aggregate balance sheet valuation of Playtech’s investments stood at £3.22 per share in the first half of 2025, but Peel Hunt believes this could reach as high as £5.93 per share or fall as low as £2.50.
The analysts highlighted that Playtech does not need every investment to pay off, noting it needs only one Caliente Interactive-scale win from its 14 other investments to transform the currently beleaguered share price.
Playtech’s 30.8% stake in Caliente Interactive, the market-leading online sports betting and gaming brand in Mexico, represents its most significant holding.
The position originated from a €17m loan or investment made in 2014 and had a balance sheet value of €726m, or £2.05 per share, in the first half of 2025.
The analysts identified an emerging investment strategy around sports data as another area of hidden potential.
Playtech holds a 49% stake in LSports, alongside positions in other sports data and news businesses including Algosport 123, Sporting News and Stats International.
Peel Hunt addressed the potential risk from litigation initiated by Evolution, which on 21 October announced court proceedings had identified Playtech’s role in commissioning a report into Evolution.
The Swedish company subsequently said it intended to amend its complaint to include Playtech as a defendant in the continuing lawsuit.
The analysts’ base case assumes the matter will be settled at relatively modest cost. In their bear case valuation, they incorporated a potential €50m cost to Playtech, while their bull case factors in a potential €50m benefit if Evolution faces difficulties retaining licences and commercial relationships.
Jones and Jack added: “Our best projection is that this matter is settled at relatively modest cost. We are informed in this view partly by the outcome of the Caliente Interactive dispute.
“This looked extremely negative at first but was resolved via negotiation, and ended up, probably, with an overall positive impact on valuation as it brought Playtech closer to monetising its interest.
“In our downside case, we incorporate the Evolution situation resulting in a cost to Playtech. However, our upside case factors in the potential benefit if one of Playtech’s major competitors finds it more difficult to get and retain licences and commercial relationships.”
The case most recently saw Evolution ordered to release documents related to regulatory investigations into the business, which led to it filing a protective order to prevent “proprietary information” from being revealed.
Private intelligence firm Black Cube responded to this by arguing the information is not secret, and that Evolution is attempting to litigate the dispute in public while blocking the defendants from doing the same.
Even Peel Hunt’s bear case valuation of £5.56 per share sits well above Playtech’s current share price of £2.88, whilst the base case of £6.91 underpins the new target price. The analysts’ bull case scenario reaches £10.20 per share.
Playtech’s share price has been trading at £2.88, giving the company a currenty market capitalisation of around £889m.
The broker is forecasting earnings per share of €0.138 for 2025, rising to €0.202 in 2026.
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