Liberum starts GVC Holdings at 'buy'

The brokerage said GVC is a unique quoted gaming operator in terms of geographic diversity and exposure to growth markets. With only around 10% of its customers in the UK, it is the least exposed of any peer to the risk of increasing duty/regulation in its domestic market, Liberum said.

The international spread of the business also means there are no significant implications to the group from the UK’s decision to leave the European Union.

Liberum also pointed out that margins are higher at GVC than the likes of William Hill and Ladbrokes, partly due to exposure to markets which are less competitive.

In addition, it argued that the synergy benefits of Bwin are substantial and said it expects earnings per share to more than double between full-year 2016 and FY18.

“The acquisition of bwin.party has dramatically increased the scale of GVC and considerably broadened the brand portfolio and geographic reach of the business. The enlarged group owns a significant proportion of the underlying IP in both its Sportsbook and gaming platform where there is also the potential to monetise a B2B opportunity.”

At 1000 BST, GVC shares were up 2.7% to 681.50p.