Entain PLC (LSE:ENT) has received a renewed vote of confidence from Deutsche Bank, which reiterated its buy rating and 872p price target after BetMGM’s third-quarter results exceeded expectations.
The Entain-MGM joint venture reported quarterly revenue of $710 million, representing 7% growth compared to just 3% growth recorded in the second quarter.
That result came in ahead of Deutsche Bank’s own estimate of $700 million, signalling meaningful momentum in the business heading into the final stretch of the year.
The stronger performance extended beyond the top line, with EBITDA surging 112% to $86 million, well ahead of the broker’s forecast of $60 million.
Revenue growth was driven by a 7% increase in sports and a 6% rise in iGaming, with year-to-date gains coming in at 4% and 8% respectively across those two segments.
Sports results were not cited as a material factor in the performance, meaning the underlying business delivered the gains through commercial rather than outcome-driven means.
Higher spending per active customer was identified as the key engine of growth, with sports spending up 18% and iGaming spending up 4%, according to the broker’s note.
That spending growth arrived despite a 3% decline in active customer numbers, highlighting the update’s dependence on monetisation rather than audience expansion.
Analyst Richard Stuber described the World Cup as a successful event for both player acquisition and customer engagement, pointing to its role in supporting the BetMGM platform.
BetMGM also maintained its position of avoiding prediction market activity, a strategic choice that sets it apart from some of its competitors in the current market environment.
For Entain specifically, the joint venture returned $34 million in cash during the quarter, which included a $25 million dividend that matched expectations.
Deutsche Bank’s full-year dividend estimate for BetMGM stands at approximately $100 million, suggesting the venture remains broadly on track to hit that target as the year closes out.
