Esports Entertainment Announces Reverse Stock Split of 1-for-400 Ratio

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Esports Entertainment ($NASDAQ:GMBL), a leading esports entertainment and technology company, recently announced a reverse stock split of its common stock on a 1-for-400 ratio. This will lead to a sharp decrease in the number of common shares outstanding and is a move to increase the company’s stock price and build liquidity in the market. ESPORTS ENTERTAINMENT is focused on esports entertainment, technology, and related products. The company has developed various platforms for mobile and online gaming, as well as several products and services. The company’s portfolio includes the Esports Gaming League (EGL), an esports tournament platform; EGLX, an online gaming platform; and The Gamer Agency, an influencer and branding platform. ESPORTS ENTERTAINMENT also owns and operates the World Esports Association (WESA), an esports association that provides players with competitive gaming rights.

The reverse stock split of 1-for-400 ratio is intended to increase the price of ESPORTS ENTERTAINMENT’s common stock in order to meet the requirements of a major national securities exchange. It will also decrease the number of common shares outstanding, allowing for greater liquidity and marketability. The company has also proposed to adopt a new ticker symbol, “EEGTF”, to represent its common stock following the reverse split.

Market Price

The move resulted in a significant plunge in the stock’s market value, which opened at $0.0 and closed at $0.0, a 41.2% drop from the previous closing price of 0.0. The reverse stock split is intended to increase the liquidity of ESPORTS’ common stock by making it more attractive to a broader range of potential investors, as well as providing an opportunity for current shareholders to increase their investment in the company. ESPORTS also intends to use the increased liquidity to pursue its planned growth strategy. The Board of Directors recommend that shareholders take no action with respect to the reverse split, as their shares will automatically be exchanged in accordance with the terms of the reverse stock split. Live Quote…

About the Company

Income Snapshot

Below shows the total revenue, net income and net margin for Esports Entertainment. More…

Cash Flow Snapshot

Below shows the cash from operations, investing and financing for Esports Entertainment. More…

Balance Sheet Snapshot

Below shows the total assets, liabilities and book value per share for Esports Entertainment. More…

Key Ratios Snapshot

Some of the financial key ratios for Esports Entertainment are shown below. More…

Analysis

GoodWhale has conducted an analysis of ESPORTS ENTERTAINMENT‘s financials and assessed its classification as a ‘rhino’. This type of company is considered to have achieved moderate revenue or earnings growth. According to our Star Chart, ESPORTS ENTERTAINMENT is strong in certain areas such as liquidity and cash flow, but is weak in asset, dividend, and profitability. Furthermore, ESPORTS ENTERTAINMENT has a low health score of 0/10 with regard to its cashflows and debt, indicating that it is less likely to pay off debt and fund future operations. Given this analysis, what type of investors may be interested in this type of company? Generally, such companies may be attractive to investors looking for companies with the potential for growth and those who have a higher tolerance for risk. As this company has a low health score, caution should be exercised as it may not always be able to pay off debt and fund future operations. Some investors may find this type of company attractive for its potential rewards, while others may prefer to invest in more reliable and stable companies. More…

Peers

The company offers its services to both individual and institutional customers. The company operates in the United States, Canada, the United Kingdom, Malta, and Curacao. The company was founded in 2014 and is headquartered in Los Angeles, California. The company’s competitors include VIP Entertainment Technologies Inc, Inspired Entertainment Inc, and PENN Entertainment Inc.

– VIP Entertainment Technologies Inc ($TSXV:VIP)

VIP Entertainment Technologies Inc is a Canadian entertainment company that operates in the business of providing turnkey solutions for live entertainment events. The company offers a variety of services including event planning, venue management, ticketing, and artist management. VIP has a team of experienced professionals that have a proven track record in delivering successful events. The company is headquartered in Toronto, Canada.

– Inspired Entertainment Inc ($NASDAQ:INSE)

Inspired Entertainment Inc, a gaming technology company, provides virtual sports and gaming products worldwide. The company operates in two segments, Virtual Sports and Gaming Platforms. It offers a suite of virtual sports products, including football, greyhound, horse, and auto racing; and gaming products, such as poker, casino, and bingo. The company was formerly known as Digital Gaming Corporation and changed its name to Inspired Entertainment, Inc. in August 2014. Inspired Entertainment Inc was founded in 2001 and is headquartered in New York, New York.

– PENN Entertainment Inc ($NASDAQ:PENN)

PENN is a leading provider of gaming and entertainment experiences in the United States. The company owns and operates a number of gaming and entertainment properties, including casinos, racetracks, and hotels. PENN also operates an online gaming platform. The company’s market cap is $5.53 billion as of 2022 and its return on equity is 14.8%. PENN’s properties include some of the most iconic names in the gaming and entertainment industry, such as the Tropicana in Atlantic City and the Hollywood Casino in Pennsylvania. The company is committed to providing its guests with an unparalleled gaming and entertainment experience.

Summary

Esports Entertainment is a global leader in e-sports and gaming entertainment. Recently, the company announced a 1-for-400 reverse stock split, meaning that for every 400 shares held by shareholders, they would receive 1 share. This move had an immediate impact on the stock price, which moved downwards on the same day. For investors considering whether to invest in Esports Entertainment, it is important to take into account the fact that the company’s stock price is likely to remain volatile, given the reverse stock split.

Investors should also consider the company’s financial performance in recent years, including its revenue and earnings growth, and its competitive position in the gaming and e-sports industry. Finally, it is important to consider the company’s long-term outlook and potential future growth prospects before deciding whether to invest.