How Genius Sports (GENI) is Capitalizing on Media Monetization & Operating Leverage

Genius Sports Limited (NYSE:GENI) is one of the best communication services stocks according to Hedge Funds.

Benchmark & Co analyst Mike Hickey reaffirmed his bullish stance on Genius Sports Limited (NYSE:GENI), assigning a Buy rating to the stock on December 30. The analyst has estimated a price target of $16, which implies an upside potential of over 54%.

Hickey attributed his outperform rating on Genius Sports Limited (NYSE:GENI) to various structural factors. One of them is the company’s rising fixed cost basis, which leads to its increasing operating leverage. Besides that, the company has a unique edge in media monetization. Instead of banking on traditional routes of content licensing, they are able to monetize content in real-time through advertising and highly interactive data-driven engagement methods.

Hickey also acknowledged management’s multi-year guidance during the Investor Day presentation, where they forecasted $1.2 billion in revenues by 2028. The company is also expected to achieve approximately 30% adjusted EBITDA margins and an approximately 60% free cash flow conversion ratio.

On December 4, Citizens had also revised its target price for Genius Sports Limited (NYSE:GENI) from $15 to $17. Rating the stock as Buy, the firm projected a strong cash flow conversion ratio of 9% in the upcoming year-end results, leading to $12 million in free cash flows.

Genius Sports Limited (NYSE:GENI) is a sports data, analytics, and technology company that delivers data management and technology-enabled solutions for fans, sports leagues, and media companies. They also engage with bookmakers in the betting market, where they leverage their data management capabilities to optimize betting markets.

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Disclosure: None. This article is originally published at Insider Monkey.