Codere Online Swiftly Appeals Nasdaq Delisting Notice

• Delisting notification was widely expected
• Stems from delays in auditing 2024 financial results

Codere Online Luxembourg (NASDAQ: CDRO) told investors Thursday that it received a delisting notification from the Nasdaq Stock Market, which the gaming company has quickly appealed.

The exchange operator delivered a letter to Codere Online on May 16 after the May 12 deadline for the online sports betting firm to file its 2024 audited financial results passed. Last December, Codere’s auditor resigned, prompting the company to find a new auditor, which has delayed filing of its Form 20-F filing with the Securities and Exchange Commission (SEC).

It (the Nasdaq letter) also automatically stays the suspension of trading of the Company’s securities for a period of 15 days from the date of the request. The Letter also states that when the Company requests a hearing, it may also request a further stay of the suspension of trading through the duration of the hearing process,” according to a statement issued by Codere.

In other words, the stock will continue trading for at least three trading weeks while the matter is sorted out. Codere has requested a hearing with the exchange operator and those events typically occur within 30 to 45 days of request.

Codere Online Stock Undaunted

The specter of delisting has hung over Codere Online for months, but it hasn’t been a detriment to share price performance this year as highlighted by a gain of 16.74%.

The gaming company is doing what it can to avoid suspension of trading, which could arrive on June 6, and come into compliance with Nasdaq listing requirements.

“Earlier today, the Company formally requested both a hearing to review the delisting determination and a further stay of suspension of trading through the duration of the hearing process,” according to the press release. “Furthermore, in connection with this stay request, the Company submitted materials to Nasdaq to explain why this stay is appropriate, as required by Nasdaq. The Company has not yet received a determination regarding its request for this further stay of suspension of trading.”

Codere Online Fundamentally Sound

Putting the delisting issue to bed could be a boon for Codere Online’s share price because the company is fundamentally sound. For example, it bought back $500K worth of its shares in the first quarter and analysts believe the operator could boost free cash flow (FCF) this year.

Looking to the remainder of FY25, rising competition into World Cup & following Spain rule changes are key risks, though total addressable market growth remains healthy across CDRO’s core markets with market share resilience supported by omnichannel advantages & market complexities,” notes Stifel analyst Jeffrey Stantial.

Stantial rates the stock a “buy” with a $10 price target, implying significant upside from Thursday’s close at $7.53.