Consumer Cyclicals: Kambi Group (KMBIF) is statistically cheap

Kambi provides sports betting technology worldwide. Over 40 operators on six continents are part of their partnership. From compliance to odds-compiling, Kambi offers a wide range of services through its in-house software platform. Over 1,000 employees work at eight global locations: Malta (headquarters), Australia, Copenhagen, the Philippines, Romania, Sweden, the UK, and the US. 

My analysis is only quantitative and needs more work. I'm not making a recommendation but instead for additional research if interested.

Over the past few years, Kambi has lost its three largest customers. Kindred, Penn Entertainment, and DraftKings have purchased or developed internal solutions. However, the current price may offer an opportunity. The market may have overestimated the risk of Kambi's customers sourcing their sportsbook technology.


Enterprise value per share is 8.89. That's a decline of 71.12% from 30.77 at the end of 2020. Retained earnings per share rose 200.20% over the same period, from the MRQ balance of 4.66 versus the 2020 balance of 1.46. Ratios also improved, EV/Rev = 1.40 (85.46% improvement from 2020), EV/GP = 1.42 (66.60% improvement from 2020), and EV/Retained earnings = 1.91 (76.51% improvement from the 2020 balance of 21.11).

Kambi offers barriers to entry and switching costs. With its current low valuations, it could be an acquisition candidate. 

Risks: Loss of customers when companies develop or buy existing companies with solutions. Changes in technology and government regulatory changes.

No Position: Kambi Group (KMBIF)