Thanks hammershark, great analysis. Just a couple of points I would raise on this para:
it’s a hold for me, I expect earnings growth to continue until such time a capital transaction occurs - Lawrence sells xx% to a trade buyer, or the diversified income streams become the primary drivers and the company’s current model of US state gambling-law arbitrage becomes less core.
Unfortunately there was no earnings growth last year, despite the impressive 40% revenue growth, and that's due to the 60% increase in marketing costs (including the ludicrous Ferrari sponsorship).
Also, there are no diversified income streams at the moment, and that's the biggest strategic risk with the business. They are totally focussed on North America (95% of which is the US), and while that market is still young and growing, they are also starting to lose market access in certain US states.
At the recent AGM, they were asked whether they were looking at any markets outside North America, and they said no.
