“ The UK is a small market and a small share of total equity value, and that has put pressure on valuations”
“ If you view yourself as a high growth or tech company, the US market tends to value these a lot higher than the UK market”
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already on track to deliver our targets of market growth in 2025.”
Entain’ s CEO Stella David expects the group to seize UK market share from tier two and three competitors as, unlike Entain, they may struggle to absorb the costs of regulatory changes.
According to Jones, UK investors are once again optimistic about the future of the sector, but today operators with predominantly regulated revenues are not as in demand as they once were.“ There was definitely a period when companies thought investors wanted a high proportion of business to be regulated, because regulated was seen to equal low risk. But the UK is a good example of that not being the case,” he says.
“ That period of simply thinking regulated is superior to unregulated is gone. I think investors are more likely to make an informed view about where risk is, rather than see it through the lens of regulated or not regulated.”
Evoke and Entain have also appeared more methodical in the way they communicate with shareholders, presenting a much more mediumterm investment outlook, and thereby reiterating the underlying attractiveness of the business.
DIVERSIFYING THE REVENUE MIX
Mark Segal, CEO for London-listed games provider Gaming Realms, believes diversifying the company’ s geographic portfolio to improve revenue streams has helped mitigate the impact of stagnation in the UK.“ We have quite a diversified revenue or revenue exposure now because it’ s multiple operators in multiple markets [ using our games ] and we can retain a highly efficient focused cost base. So, we’ ve been able to grow our revenue year-onyear,” he tells iGB.
“ The UK is a small market and a small share of total equity value, and that has put pressure on valuations”
Ivor Jones, Peel Hunt
“ If you view yourself as a high growth or tech company, the US market tends to value these a lot higher than the UK market”
Ed Birkin, H2 Gambling Capital
Gaming Realms started its life as a listed operator, with the Foxy Bingo brand under its umbrella. But on acquiring social games platform Slingo in 2015, the group pivoted to a pure-play B2B provider. Segal says shareholders responded well to the company’ s transition and new investment poured in.“ It’ s clear investors really like the B2B model. I think they find that very attractive and that’ s where we are now.
Segal admits tightening regulations hit operators harder, while suppliers are somewhat shielded from the impact of heavy-handed player protection measures. Operators are more exposed to risk, he suggests, and that makes satisfying shareholders more difficult.
ALLURE OF THE US
With UK valuations impacted by the wider economic environment and outflows of public liquidity, some UK and European-listed companies have relocated to US exchanges, on the promise of better access to capital. The New York Stock Exchange( NYSE) is the biggest stock exchange globally with a market cap of $ 36 trillion, according to Statista, followed closely by Nasdaq, also based in New York.
Shell, one of Europe’ s most prominent oil and gas entities, floated the idea of switching its LSE listing to the US in 2024 as its American peers were experiencing much higher valuations. The company reiterated it was still reviewing this option in January, after its 2024 revenue declined 16 % to $ 23.7 billion.
Another recent example is Wise, a UK-listed fintech, which in June announced it would shift its primary listing to the US. CEO Kristo Käärmann said the US listing would enable better access to the world’ s deepest and most liquid capital market.
36 • ISSUE 138 • iGB L! VE 2025