Playtech Stock Plunges After €1.8B Special Dividend

Playtech, a leading gambling tech company, has seen its stock price crash by over 60%, dropping from 800p to 316p, after giving out a huge special dividend. This payout came from selling its Italian consumer brand Snaitech to Flutter Entertainment for €2.3 billion ($2.6 billion), giving back almost two-thirds of Playtech’s market value to its shareholders.

Analysts Link Playtech’s Stock Slump to Dividend, Highlight Future Growth Potential

Market experts noted that the big fall in stock price matches how much the dividend paid out. Peel Hunt, a stock trading company in London, still thinks the stock looks good, reported City AM. The company points out Playtech’s worth over time and its complex company structure, saying that even with the change, there is still room for it to go up quite a bit.

After selling off Snaitech, Playtech now supplies other businesses. This shift in focus showed up in the strong growth of its main B2B division. In 2024, Playtech made €1.79 billion ($2 billion) in revenue, which was 4.9% more than the year before. While it did not grow as fast as in past years, EBITDA went up by 22%. This boost came from new team-ups and growth in the US market.

A major factor in the company’s success was its teamwork with big American companies. Playtech started live-streamed casino content through the new MGM Live brand, working with MGM Resorts International. They also made deals with Ocean Casino in Atlantic City and Delaware North, which made Playtech stronger in the US.

Playtech Lifts Stake Values, Eyes 25% U.S. Market Growth Through 2027

The company also raised the value of its shares in several businesses. Its part in Mexican operator Caliente went up to €802 million ($901 million), while its investment in Hard Rock Digital grew to €141 million ($158 million). Playtech thinks the US market will grow a lot, maybe up to 25% from 2024 to 2027, helped by ongoing work with brands like Hard Rock and DraftKings.

Despite its current stock drop, Playtech’s latest full-year results beat what the market expected, with an adjusted operating profit of €480 million ($539 million).

The company remains sure about its future, backed by a business model that can grow and a seasoned management team aiming to create value over time. While the market reacted strongly to the dividend news, Playtech’s operational indicators point to a company changing, not failing. As it builds up its B2B presence and keeps making the most of key partnerships, investors might start to feel more confident in the coming months.