Inspired Entertainment (NASDAQ: INSE) shares jumped almost 11.6% on March 11, despite the game technology company delivering mixed fourth-quarter results.
Revenues topped estimates driven by robust demand and momentum across all the business segments, and a sharp recovery in Gaming and Leisure segments, after the reopening of retail venues following the pandemic situation. However, earnings failed to meet analysts’ expectations.
Inspired Entertainment offers virtual sports, mobile gaming, and server-based gaming systems with associated terminals, digital content, regulated betting, gaming, and lottery operators globally. Markedly, shares have risen 33.1% over the past year.
Mixed Q4 Performance
During the Q4 quarter, adjusted revenues totaled $67 million, up 71% year-over-year. It easily outperformed the $61.67 million average predictions, reflecting continued momentum and robust demand across all the business segments. In particular, Leisure revenues rose 183% to $23.5 million, acting as a tailwind.
Despite strong revenue numbers, the company posted a loss of $0.05 per share, way short of analysts’ expectations of earnings of $0.05 per share. Further, it was much worse than the previous year’s earnings of $0.12 per share.
CEO Comments
Looking ahead to the upcoming year, Inspired Chairman, Lorne Weil, commented, “The consistent momentum we saw building throughout 2021 and the strong demand that continues to exist for our products across each of our business lines, including the industry outlooks for land-based gaming coming out of COVID-19 and sustainable online growth trends, further support our confidence in the long-term outlook for the Company.”
Analysts Recommendation
The stock has picked up a rating from one analyst in the past three months.
Roth Capital analyst Edward Engel has a Buy rating on the stock with a price target of $18 (36.5% upside potential).
TipRanks’ Smart Score
INSE scores a 9 out of 10 on TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations.
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