Shore Capital has reiterated its Buy recommendation on Entain PLC (LSE:ENT) following a first-half earnings performance that comfortably exceeded the broker’s expectations.
The broker maintains a price target of 988p on Entain shares, which currently trade around 560p, implying potential upside of approximately 76% from current levels.
Group EBITDA came in at £574 million for the period, well ahead of Shore Capital’s forecast of roughly £535 million, driven by accelerating online growth across key markets.
Digital net gaming revenue rose 7% during the half, picking up pace from the 5% growth recorded in the first quarter and reaching the top of Entain’s stated medium-term growth range of 5% to 7%.
Within the digital segment, gaming revenue grew 9% while sports revenue increased 4%, with the UK and Australia emerging as the strongest performing regions, each recording growth of 13%.
Digital EBITDA declined by around £10 million, but that result was significantly better than Shore Capital’s anticipated decline of approximately £40 million, and full-year digital margin guidance of 21% to 22% was left unchanged.
BetMGM, the US joint venture, reported $99 million of adjusted EBITDA for the half and is expected to finish toward the bottom of its $300 million to $350 million full-year guidance range.
Shore Capital kept its FY26 group EBITDA estimate at £1.139 billion and its EPS forecast at 55p, noting that Entain trades on just 10 times forecast earnings and around six times EBITDA.
“We have longed struggled to understand Entain’s modest valuation given its broad revenue base, much improved operational performance and peer comparatives,” the broker said.
Entain, which owns the Ladbrokes and Coral betting brands, reported group net gaming revenue from continuing operations up 5% year-on-year on a constant-currency basis during the six months to June 30, 2026.
The online performance was supported by 9% underlying volume growth and stronger customer engagement around the Men’s World Cup, which boosted sports net gaming revenue during the period.
Underlying group EBITDA was £479 million, down 2% year-on-year, or £473 million when excluding fees received from the BetMGM joint venture partnership.
Entain reported a loss after tax of £11.4 million from continuing operations, representing an improvement of £74 million compared with the previous corresponding period.
The company reiterated its 2026 earnings guidance alongside plans to generate around £500 million in annual adjusted cash flow by 2028, signalling confidence in its medium-term financial trajectory.
