Evolution AB "Q2 Preview: A Higher Bar, Mixed Fundamentals" (Sell) Shelley

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Evolution AB "Q2 Preview: A Higher Bar, Mixed Fundamentals" (Sell) Shelley

FY26 is that consensus forecasts imply a sequential acceleration in 12/26E 5.36 5.32 -1 5.32

European growth through H2, creating downside risk if our more cautious Q2 12/27E 5.97 5.96 -0 6.03

assumptions prove correct. More importantly, many of the challenges facing EVO in the 12/28E 6.60 6.65 1 6.70

region appear largely outside EVO’s control, raising the risk that consensus’ hopes for a

near-term stabilisation in European revenues may prove overly optimistic. Ben Shelley, ACA

Analyst

ben.shelley@ubs.com

We are more constructive outside of Europe

+44-20-7568 3957

In Asia, we see scope for modest sequential growth of +2% QoQ, as EVO continue to

Jarrod Castle, CFAretain a better balance on cyber counter measures. While the data signalled further

acceleration in YoY cc revenue growth, we would flag (a) the data is benefitting from jarrod.castle@ubs.com

softer comps, while comps toughening for EVO Asia revenues and (b) cautious company +44-20-7568 8883

commentary at Q1 regarding "volatility" and "uncertainty". As such, we take a more

Artem Prokopets

measured view. Elsewhere, we expect areas of relative strength in North America (with

EVO marginally outperforming the US iGaming data in Q1) and Latin America (which artem.prokopets@ubs.com

saw meaningful QoQ growth at Q1). +44-20-7901 5625

Valuation: DCF based PT of 520 SEK (unchanged)

PT implies ~9x '26 PE vs current trading 11.5x. On our estimates, EVO's current PEG ratio

is amid the highest in the European Online Gaming & Betting sector. Our estimate

changes are limited. We cut group revenues -0.5% and EBITDA -0.6%. EPS revisions are

also driven by changes to our buy back cadence assumptions.