Jumbo Interactive: You make your own luck
About the author:
- Author name:
- By Alexander Mees
- Job title:
- Co-Head of Research and Senior Analyst
- Date posted:
- 05 May 2023, 7:30 AM
- Sectors Covered:
- Gaming and Retail
- We have increased our EBITDA estimate for FY24 by 8% to $79m following Jumbo Interactive’s (ASX:JIN) announcement that it will increase the commission it charges on digital lottery tickets later this month, a move that is expected to add $12m to EBITDA.
- A poor run of large Powerball and Oz Lotto jackpots in recent months, as well as indications that the structural growth in digital penetration may have temporarily slowed, causes us to lower our FY23 EBITDA estimate by 7% to $59m.
- Shares in JIN have underperformed as the market took note of the notable absence of large jackpots. We have regarded this as an opportunity to buy into the stock as jackpot sequencing is both out of JIN’s control and likely to normalise in time. The news around pricing adds further conviction to our positive call.
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