Sportradar Lands Slew of Bullish Ratings as Analysts Start Coverage

Sportradar (NASDAQ:SRAD) is about a month removed from its initial public offering (IPO), so it’s time for analysts to start covering the name. And they are doing just that in broadly bullish fashion.

At least a dozen sell-side analysts initiated coverage of the sports betting data provider today. All of them did so with “buy” or equivalent ratings, despite the fact that Sportradar is off 6.57 percent since its Sept. 14 IPO.

Citi analyst Jason Bazinet started coverag on Sportradar and rival Genius Sports (NYSE:GENI) with “buy” ratings, citing strong growth forecasts for the sports wagering market.

We expect the global [online sports betting] market to grow 17% per annum from 2019 to 2025, underpinned by faster growth in the US (due to regulatory tailwinds),” according to Citi. “We expect the iGaming market to grow at a similar pace of 16% per annum from 2019 to 2025.”

Bank of America analyst Shaun Kelley is also bullish on Sportradar stock, rating it a “buy,” with a $28 price target, implying 19 percent upside from the Oct. 8 close. Citing revenue growth opportunities in markets such as the US, Canada, Brazil, and India, Kelley says Sportradar can deliver sales growth of 20 percent next year and 19 percent in 2023.

Lots of Love for Sportradar Stock

Sportradar doesn’t operate sportsbooks. Rather, it provides data to leagues that is then supplied to gaming companies.

Benchmark analyst Mike Hickey rates Sportradar a “buy” with a $30 forecast, citing the company “leadership” in sports data, which he sees increasing as the domestic sports wagering industry expands. JPMorgan analyst Daniel Kerven launches coverage of the stock with an “overweight” grade and $27 price projection, citing the company’s “picks and shovels” assets that are essential in the rapidly evolving regulated sports wagering space.

Investors that are bullish on the sports betting data space contend that as regulated sports wagering grows, sportsbooks will be compelled to pay up for the premium data purveyed by Sportradar and its rivals.

Other Views on Sportradar Stock

While both Sportradar and Genius Sports are newly public companies, there’s already chatter in the analyst community that these firms should be valued in similar fashion to software as a service (SaaS) stocks.

If that assessment proves accurate, it could bolster the investment thesis for Sportradar and its competitor, because market participants have long displayed enthusiasm for SaaS stocks.

As for other analysts starting coverage of Sportradar, Deutsche Bank analyst Steven Pizzella and Needham’s Bernie McTernan both rate the name “buy,” with $28 price targets.

In terms of lofty price targets, Canaccord analyst Michael Graham and Craig-Hallum’s Ryan Sigdahl lead that group with $35 forecasts on Sportradar.