Stocks Tracker: Q3 ends in a quandary as shares slip on hacks and trading updates
EGR analyses the share price movements of major players in September, including MGM Resorts, Entain and GiG
Entain
1 September closing: 1,154p
29 September closing: 933p
Peak September closing: 1,186p
Entain and American rock group Green Day is the unlikely matchup this month; ‘Wake me up when September ends’ being one of the band’s biggest hits, and Entain’s thoughts following a sore September on the stock market.
A run of the mill month appeared to be on the cards for the FTSE 100 operator, with a couple of slight dips in the first three weeks being recovered to land at 1,110p by Wednesday 20 September. However, the following week sent the group’s shares into freefall.
A trading update, released on Monday 25 September, confirmed the operator was expecting “softer than anticipated” Q3 online net gaming revenue. Entain pointed to regulatory headwinds, sporting results and slow growth in Italy, the UK and Australia as core reasons for the performance.
As a result, proforma NGR is expected to be down by a “low single-digit percent”.
The firm did insist there had been good underlying growth during the reporting period, as well as continued success in its US-facing joint venture BetMGM. However, the silver linings did little to abate the market, as an early trading sell off saw Entain’s stock fall by 12%.
The operator closed out the day with a share price of 918p, a monthly low, but a slight recovery saw its stock rise to 933p by the month’s end. The result of the trading update saw Entain’s stock slip 19% during the month.
MGM Resorts
1 September closing: $44.43
29 September closing: $36.91
Peak September closing: $44.43
US casino giant MGM Resorts will be looking to put September firmly in the rear-view mirror after a poor performance on the stock market, driven by cyberattacks. The operator, along with Caesars Entertainment, was hit with crippling hacks in September which impacted its land-based operations.
An initial hack on 7 September saw customer reservations, on-site withdrawals and slot machines on casino floors rendered unusable. On 14 September, the group was hit again, this time with six terabytes of personal data reportedly stolen.
The ALPHV/BlackCat ransomware group took responsibility for the hack, and it took two weeks for MGM to report its services were “operating normally”.
Upon confirming its operations were back to normal, despite some promotional services still being unavailable, stock continued to slump for the operator. From Wednesday 20 September close of $39.29, MGM closed out the week at $36.60.
A full month decrease of 17% in the group’s stock will have been a blow to the operator as they also deal with class-action complaints from a slew of legal firms naming the operator having been filed on 21 September, which are seeking injunctive relief.
Gaming Innovation Group (GiG)
1 September closing: SEK29.85
29 September closing: SEK28.65
Peak September closing: SEK30.70
September marked an anomalous period for Gaming Innovation Group (GiG) over the previous six months which saw the Malta-based firm perform well on the stock market. While the group continues to engage in its strategic review to split the business into two distinct arms, former CEO Richard Brown confirmed his early departure from the company mid-way through the month.
Brown, who is set to join Glitnor Group as CEO next year, was expected to step down on 31 December but called time early on his reign with the firm. The news sent GiG’s shares down slightly, closing out at SEK29.
GiG moved quickly to announce Brown’s replacement as the group drafted in its media division CEO, Jonas Warrer, as acting boss. Warrer will remain as group CEO until the proposed split of the business completes.
The confirmation of Warrer as acting CEO saw GiG’s shares jump to a monthly high of SEK30.70 on Friday 22 September, as the market reacted positively to the company stalwart being given the top job. However, the joy was short lived as GiG’s stock proceeded to slide during the remainder of the month, before bottoming out at a low of SEK28.65 on Friday 29 September.
When GiG completes the business divide, which will see its media and sports betting supplier arm operate independently, it confirmed it is contemplating listing the pair as separate entities on the Nasdaq.