Limited surprises

Q1 was slightly above expectations but triggers limited revisions. Potential NL deposit limits could hurt Kindred as market leader. Keep HOLD on neutral risk-reward with SEK 130 cash offer.

Kindred Group (Hold, TP: SEK130.00) - And the winners are… the French?

Although we consider Paris-listed FDJ’s proposed cash offer unattractive, not reflecting Kindred’s true earnings potential (2025e EV/EBIT of 8x), we have downgraded to HOLD (BUY) and lowered our target price to SEK130, in line with the proposed bid (base case). At the same time, we do not rule out a strong medium-term outlook and 2024 earnings that could prompt a scenario where FDJ must raise its proposed bid to secure the necessary acceptance rate from Kindred’s shareholders.

Kindred Group (Buy, TP: SEK145.00) - We believe the pressure is health...

We expect sizeable Q4 earnings growth (adj. EBITDA up >35% YOY) thanks to easy comparables and stricter cost control. We are attracted to the possible key upcoming catalysts: 1) a potential business combination with a third party (based on the board’s communication); and/or 2) interim management pushing hard to maximise 2024e earnings (ambition of 25% adj. EBITDA growth YOY). We reiterate our BUY and SEK145 target price.

Kindred Group (Buy, TP: SEK145.00) - Dressed for 2024e earnings growth

We reiterate our BUY but with a lowered target price of SEK145 (155), having cut our 2024e EBITDA by 5%. Thanks to a strict cost-saving plan and profitable core market growth focus, we find the near-term earnings case largely de-risked. We expect investors to increasingly focus on the potential upcoming ‘third-party transaction’ as indicated by the board as well as the improved earnings for 2024e (EBITDA up 32% YOY).

Kindred Group: 4 directors

Four Directors at Kindred Group bought 2,625 shares at 90.493SEK. The significance rating of the trade was 50/100. Is that information sufficient for you to make an investment decision? This report gives details of those trades and adds context and analysis to them such that you can judge whether these trading decisions are ones worth following. Included in the report is a detailed share price chart which plots discretionary trades by all the company's directors over the last two years clearly...

Kindred Group (Buy, TP: SEK155.00) - Opportunity from low sports margi...

We reiterate our BUY and SEK155 target price ahead of the Q3 results, where we expect a lower-than-usual sports margin (player-friendly results in European football). Thus, we have cut our 2023e EBITDA by 4% but have left our 2024–2025e fairly unchanged. Details about the strategic review should be released near-term and the earnings growth case is intact, with 40% and 28% adj. EBITDA growth YOY for Q4e and 2024e, respectively.

Northern Lights

Kindred Group (Buy, TP: SEK155.00) - You should go with orange

We reiterate our BUY and have raised our target price to SEK155 (150), having boosted our 2023e adj. EBITDA by 3%, to GBP212m, comfortably in line or above Kindred’s reiterated guidance of at least GBP200m. We believe the new management is in good control of operations and see healthy double-digit earnings growth for H2e, supported further by a solid Netherlands. Coupled with the ongoing strategic review (which could include, e.g., a sale of the company, according to the board), we expect a cont...

Northern Lights

Kindred Group (Buy, TP: SEK150.00) - Speeding up to its true potential

We estimate Q2 adj. EBITDA grew c100% YOY (results due at 07:30 CET on 25 July), due to healthy progress in the re-regulated Netherlands, a strong sports margin, growing cost control, and easy comparables. We have raised our 2023e EBITDA by 2% (positive underlying growth trend offset negative FX) and increased our target price to SEK150 (145). We reiterate our BUY. Near-term earnings and the ongoing strategic review should be positive for the share price looking ahead.

Kindred Group (Buy, TP: SEK145.00) - Straightforward communication

We reiterate our BUY and have raised our target price to SEK145 (135) given the straightforward communication from the board about the “review of strategic alternatives” and our view of the increasing likelihood of Kindred being part of possible future consolidation. We expect it to hit its target of at least GBP200m EBITDA in 2023, but looking beyond we see material earnings upside potential.

Kindred Group (Buy, TP: SEK135.00) - Interesting proposed board change...

We reiterate our BUY and SEK135 target price despite cutting our 2023e EPS by 3%. We see strong Q1e earnings growth as well reflected in consensus, but on the positive side, we expect Kindred to maintain its 2023 guidance (adj. EBITDA >GBP200m) and report NTM EBITDA growth of c40%. The likely upcoming board changes (five new members proposed ahead of the AGM) could mark a new strategic direction with more focus on potential future business combinations, we believe.

Northern Lights

Kindred Group (Buy, TP: SEK135.00) - Eyes on the road again

We have raised our target price to SEK135 (125) after the strong start to Q1 and positive near-term outlook (e.g. a busier betting event schedule). We have increased our 2023–2024e EPS by 4–7%, and believe Kindred is well on track to reach its 2023 EBITDA guidance of at least GBP200m. 2023 should be eventful, with potential board changes and a need for management to deliver on near-term revenue growth and profitability, in our view.

Kindred Group (Buy, TP: SEK125.00) - Time to improve

We reiterate our BUY recommendation but have cut our target price to SEK125 (130) following the Q4 profit warning, as we still expect high revenue and earnings growth driven by the Dutch re-entry and solid active player growth. To reflect the announced 2023 adj. EBITDA guidance (at least GBP200m, up c60% YOY), we have cut our 2023e adj. EPS by 12%.

Kindred Group plc - Solid report, strong outlook – keep BUY

Q3 adj. EBITDA 2% above mid-point of guidance Set for a strong Q4, we raise ‘22e EBITDA by 1% We hold ‘23e largely unchanged – keep BUY

Kindred Group plc - Reassuring outlook

Sales and adj. EBITDA in line with pre-guided ranges Solid trading update – expect cons to raise ‘22e by 2-5% Set to outperform the market today by low-single digits

Kindred Group plc - Set to end the year in style

Q3 trading update announced; we focus on Q4 Solid Q4 trading update expected, but WC starts 20 Nov Good R/R near-term with strong valuation support

Kindred Group (Buy, TP: SEK130.00) - A credible growth story

We have raised our 2022–2024e adj. EPS by 4% after signs of resilience and a strong start in the re-regulated Netherlands. We expect quarterly average revenue growth of 20% YOY in the next 12 months thanks to the FIFA World Cup, recent Dutch re-entry, and structural growth in Kindred’s main markets. We reiterate our BUY and have raised our target price to SEK130 (125).

Kindred Group plc - The margin recovery race has started

CMD thoughts – we go through the targets Q3 update and ’22e-’24e estimate changes Attractive ‘23e-’24e multiples and solid EPS growth