(NEW YORK)--Ludlow Research maintains coverage on Lottery.com Inc. (Nasdaq:LTRY), a leading technology company in digital lottery and sports entertainment, with a speculative price target of $10 per share.
Following our initial coverage of $LTRY at $0.90 on February 6, the stock exhibited strong buying pressure before experiencing a standard pullback to the $1.30 level today. With the company positioned to regain NASDAQ listing compliance, we feel the risk of a reverse split appears to be eliminated, potentially catalyzing a new wave of short covering at current price levels.
Typically, reverse splits are implemented when companies need to meet NASDAQ's $1.00 minimum price requirement for listing compliance. Given $LTRY's current trading level, such action appears unnecessary. Based on this development, Ludlow Research believes any short-term attempts to drive the price below $1.00 are unlikely, creating an attractive entry point for traders anticipating a potential compliance-driven price appreciation.
We maintain conviction in our $10 target, or $120 million market valuation, with the ownership of such an icon brand as Sports.com.
On Feb. 11, the company announced announces it had entered a multi-year global partnership agreement with Soccerex, the world’s leading soccer business event organizer. The Agreement makes Sports.com the title sponsor for six global events including Soccerex 2025 for MENA, Europe and USA to be held in Cairo, Amsterdam and Miami, respectively.
On Feb. 04, the company announced the launch of its international lottery operations to address growing global demand. This expansion is expected to generate new revenue streams by the end of March.
The company possesses two valuable assets in Lottery.com and Sports.com, which we estimate could conservatively be valued at $60 million each when compared to successful industry peers like FanDuel and DraftKings.
An additional factor to consider is that LTRY has no options traded against the stock, which institutions typically use to manage volatility in underlying common shares. Coupled with the possibility that LTRY may have been heavily shorted over the past two years, this creates potential for a major short squeeze event.
Given the company's limited share count of only 12 million issued shares and a float of just 4 million shares, we believe the potential to reach $10, representing a $120 million valuation for this NASDAQ-listed gaming company, is within the realm of possibility.
Disclosures and Disclaimer:
THE MATERIAL HEREIN DOES NOT CONSTITUTE AN OFFER OR SOLICITATION IN ANY JURISDICTION WHERE OR TO ANY PERSON TO WHOM IT WOULD BE UNAUTHORIZED OR UNLAWFUL TO DO SO.
This reports contains certain statements that may be deemed “forward-looking” statements. Forward looking statements are statements that are not historical facts and are generally, but not always, identified by the words “expects”, “plans”, “anticipates”, “believes”, “intends”, “estimates”, “projects”, “potential” and similar expressions, or that events or conditions “will”, “would”, “may”, “could” or “should” occur. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results may differ materially from those in forward looking statements. Forward looking statements are based on the beliefs, estimates and opinions of the Company’s management on the date the statements are made. Except as required by law, the Company undertakes no obligation to update these forward-looking statements in the event that management’s beliefs, estimates or opinions, or other factors, should change.
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Content contained herein includes facts, views, opinions and recommendations of individuals and organizations deemed of interest. Ludlow does not guarantee the accuracy, completeness or timeliness of, or otherwise endorse these views, opinions or recommendations, or give investment advice. Ludlow, its affiliates, or directors, may or may not hold a position in the above security from time to time, and investors are encouraged to consider this as a possible conflict of interest when reviewing this information. In Compliance with SEC Rule 17B Ludlow was not compensated at the time of this research alert. Investments is speculative ‘penny stocks’, as defined by the SEC, may involve a high degree of risk.
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