NetEnt | Better Gaming

Investment case

NetEnt’s scalable business model and strong market position on an attractive growth market have historically led to a strong cash flow and high dividends to shareholders. Here are four strong reasons to invest in NetEnt:

1. Attractive market
The global online gaming market continues to grow rapidly. The underlying structural growth is supported by megatrends such as globalization, digitalization and mobile growth. Consumer patterns are changing in favor of online games, and reregulation opens up new geographic markets. Online casino only accounts for 6 percent of all casino games globally while the remainder still
takes place offline. The current migration from offline to online provides for a bright future outlook for the market. Also, demand in the past has not proven to be cyclical.

2. Strong market position
NetEnt has been a pioneer on the digital casino market since its inception in 1996, and has over 170 active customers today, including most major gaming companies in Europe. In the past eight years, NetEnt has grown much faster than the market and currently has a market share of an estimated 25 percent in Europe and 15 percent globally.

3. Scalable business model with barriers to entry
NetEnt’s premium solutions for digital casino and award-winning game portfolio provide economies of scale and facilitate successful business for gaming operators. Thanks to its experience, expertise and size, NetEnt can deliver synchronized game launches for different distribution channels and geographic markets according to timetables determined far in advance. This creates entry barriers to new, smaller competitors.

4. Strong cash flow and shareholder cash returns
NetEnt’s business generates a strong cash flow. The Company’s capabilities and focus on generating profitable growth, combined with stable and relatively predictable investments, support sustained high dividends for shareholders.

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