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Bank of America downgraded Sportradar (NASDAQ:SRAD) to Underperform from Neutral primarily due to international and European exposures, as well as operating/inflationary headwinds that may pressure 2023 estimates.

Analyst Shaun Kelly and team still admire key pieces of the business model like SRAD’s sticky B2B contracts, but low visibility and a myriad of macroeconomic headwinds are seen creating too many risks to hold the stock.

On valuation, BofA noted that SRAD trades at ~14.5X the 2023 consensus EBITDA estimate and ~17X the firm’s new lowered estimate.

“This is a substantial premium to a number of other Gaming and B2B/B2C operators, while the discount to data Software peers could be harder to narrow if margins do come in below expectation.”

Shares of SRAD slid 3.55% in early trading to $8.45 vs. the 52-week trading range of $7.22 to $24.96.

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By admin