Inspired Entertainment (INSE) Receives Buy Rating from BWS Financial with $20 Price Target

BWS Financial has assigned Inspired Entertainment (INSE) a Buy rating with a $20 price target, citing no competition in the virtual sports market and anticipated growth in virtual sports. The firm expects the introduction of hybrid dealers to counterbalance slower trends in the physical gaming sector. Second-quarter results are seen as a potential trigger for supporting investment perspective.

BWS Financial has initiated coverage on Inspired Entertainment Inc. (NASDAQ: INSE) with a Buy rating and a $20.00 price target. The stock currently trades at $8.87, with analysts' targets ranging from $10 to $14, suggesting significant upside potential [1].

The research firm highlighted Inspired Entertainment's position in the evolving online gambling industry. The company has developed Virtual Sports and hybrid dealer solutions that expand online gaming opportunities for its customers. The company maintains impressive gross profit margins of nearly 70%, according to InvestingPro data [1].

BWS Financial emphasized that Inspired Entertainment faces no competition in its Virtual Sports segment. Additionally, its hybrid dealers address regulatory requirements regarding the location of live dealers. The firm stated these offerings should help the company overcome slowing dynamics in the physical gaming business, a trend that was apparent in the first quarter results and should become more visible going forward [1].

In other recent news, Inspired Entertainment reported its Q1 2025 earnings, exceeding expectations with an earnings per share (EPS) of $0.13, surpassing the anticipated -$0.04. However, the company fell short on revenue, reporting $60.4 million against the forecasted $68.4 million. Additionally, Inspired Entertainment has finalized a private placement of £270 million in senior secured notes due 2030, alongside a new £17.8 million revolving credit facility, to refinance existing debt and support corporate functions [1].

The company also launched its V-Play Football Brazil in partnership with Kaizen Gaming, marking a significant expansion into the Brazilian market. Furthermore, Inspired Entertainment has introduced the Hybrid Dealer Roulette 4-Ball Extra Bet game in the U.S. through a partnership with BetMGM. Analysts noted the company’s strong performance in its interactive business segment, which showed a 49% revenue increase [1].

Despite these developments, regulatory changes in Brazil and shifts in the UK market have posed challenges. Inspired Entertainment’s efforts to expand its digital offerings and refinance its debt are seen as strategic moves to bolster its financial position [1].

In a separate development, Inspired Entertainment has partnered with Torrero, a casino and sportsbook platform aggregator, to expand its reach across regulated markets including the United Kingdom, Estonia, and Mexico. This collaboration will bring Inspired’s acclaimed portfolio of games to new audiences, including popular titles such as Gold Cash Free Spins™, Cops ‘n’ Robbers Bigger Big Money™, and Golden Winner Grand Chance™ [2].

BWS Financial expects second-quarter results to serve as a catalyst for its investment thesis on Inspired Entertainment. The firm's positive outlook is based on the company's strong position in the virtual sports market and its innovative hybrid dealer solutions [1].

References:
[1] https://www.investing.com/news/analyst-ratings/inspired-entertainment-stock-initiated-with-buy-rating-at-bws-financial-93CH-4134058
[2] https://inseinc.com/inspired-entertainment-partners-with-torrero-to-expand-reach-through-content-aggregation-platform/