Tuesday, 14 December 2010

Betfair Valuation Update

What can I say? Not going to include any more detailed analysis as people obviously aren't that interested in it.

Half Year results this morning were less than impressive for me, especially as they include the World Cup which as we know won't be around for another 4 Years now - What is the next Event that can replace that in the figures? I can't think of one either as I don't feel the Olympics will have the same attraction to Punters.

They have admitted the Poker business is collapsing and to be honest the only way I see from here is down.

The only positive for me is the Cash Balance has increased but you would expect that as these figures include probably the most pivotal quarter in the recent development of the Company.

Should have really backed my instinct and Shorted the shares when I did the original write up, but it's not really my style to do that.

The shares are getting hammered this morning, but I get the feeling this is just the start.

Unless a large market opens up for them in the short term, you would have to think they will need to introduce some further charges to even begin to justify their current Market Capitalisation. Without either the next set of Results are going to look dire.

Having said all that, there are many people out there who know much more about it than me and they are keeping the Share Price above £10 for a reason I am sure - If anyone knows what it is could they let me know please?

For me they have got a Fast Growth Company valuation but I don't think they are even growing organically at the moment...............


  1. Ok. Forget the bit about the Cash position. Just looked at the figures properly and that is a Red Herring. Things are not even rosy on that front. See they have gone under the £10 mark - I'd consider buying at £6 but not a moment before. I think they have much further to fall.

  2. Well their own brokers posted a "sell note" last week

  3. Yes. Should be strong buying from the founders at this price - or do they know something we dont?

  4. They have just managed to get out, can't see them buying back any time soon.

    I've got a feeling the 'Betfair' days may be about to come to an end...........

    From a brilliant, innovative Company to another Ladbrokes. Real shame to be honest.

  5. Remember a computer company called DEC? Led "minicomputers" by the nose for a decade and universally accredited as a de facto supplir to small to medium business. Thus impervious to Competition.
    Problem: they believed their own hype and decided that Competition wasn't ever going to threaten their Virtual Monopoly.
    Simply put.... like all falling into that trap....

  6. Certainly do Adonis. Used to work there in the dim and distant past.

    I know what you mean though, it just feels things may be shifting in the world of Exchange Betting.

    These things run in cycles - the trick is trying to work out what is coming next.............

  7. I've put this on the forum but will repeat it here.

    Anyone who buys the shares at present price is bonkers. I have seen several comments about the fact that their expansion into US, China and India should mean that they go up. Poppycock. Even if they get through the entry barriers they will find that a company there will simply undercut them by offerring lower commission, and of course no premium charge, to say nothing of decent customer service! This could be done by simply offerring a mainstream sports only site with no poker, casino, roulette or anything else. It's only the lammentable failure from the likes of Betdaq to get their act together which has meant they've got away with it up to now. But no monopoly lasts for ever. If you have any shares, take what you can for them and get the hell out now! They are massively overvalued and should be about half their current show.

    Rant over ;)

    If you would like to swap links, I've added you already.

  8. Good point, well made Mr Wildcat.

    I've added you and will be following.

    Take Care