Everi Holdings Inc (EVRI)EVRI

Everi Holdings Inc.: A Comprehensive Overview

Company Profile:

History and Background:

Everi Holdings Inc. (NYSE: EVRI), formerly known as Multimedia Games Holding Company Inc., is a leading provider of land-based and digital casino gaming solutions. Founded in 1997 as a software development company, Everi transitioned to the gaming industry through acquisitions and strategic alliances. In 2019, Everi completed its acquisition of Multimedia Games, resulting in its current name and structure.

Core Business Areas:

• FinTech & Payments: Everi provides payment processing solutions and cash handling equipment for casinos and other gaming venues.
• Games & Content: The company develops and distributes a diverse range of slot machines, table games, and digital gaming solutions.
• Interactive: Everi offers online and mobile gaming solutions to players across multiple states in the U.S.

Leadership & Corporate Structure:

Everi's leadership team comprises experienced industry professionals, including:

• Mike Rumbolz: Chairman and CEO
• Randy Taylor: Chief Technology Officer
• Darren Lampert: Chief Marketing Officer
• Cathy Hegman: Chief Human Resources Officer
• Craig Chait: Chief Financial Officer

Everi is headquartered in Las Vegas, Nevada, with additional offices and manufacturing facilities in North America, Europe, and Asia.

Top Products and Market Share:

Everi's top products include:

• Financial Payment Solutions (FPS): A suite of payment solutions including TITO (Ticket-In/Ticket-Out), cashless wagering, and mobile payments.
• Empire DC: A high-performing premium Class III slot cabinet featuring engaging game content.
• TournEvent: A unique slot tournament system that enhances player engagement and excitement.
• Everi Digital: A growing online and mobile gaming platform with plans for nationwide expansion.

In the U.S. land-based casino market:

• FPS holds a market share of over 50%.
• Slot machines hold a market share of approximately 10%.
• Everi Digital is currently active in 9 states, with plans to increase its footprint.

Total Addressable Market:

The global casino gaming market is expected to reach a value of $651.58 billion by 2030, growing at a CAGR of 7.4%. This includes both traditional land-based casinos and online platforms. Within this market, Everi primarily focuses on the North American segment, estimated to be valued at $43.3 billion in 2023.

Financial Performance:

Recent Financial Results (Q3 2023):

• Revenue: $412.3 million (YoY Increase of 3.4%)
• Net Income: $41.6 million (YoY Increase of 5.1%)
• Profit Margin: 10.1%
• EPS: $0.62

Everi's financial performance has shown consistent growth in recent years, with revenue and profitability increasing steadily.

Cash Flow and Balance Sheet:

Everi maintains a healthy cash flow position and a manageable debt profile. As of Q3 2023, the company reported:

• Operating Cash Flow: $64.4 million
• Cash and Cash Equivalents: $440.5 million
• Total Debt: $840.3 million

Dividends and Shareholder Returns:

Everi has implemented a quarterly dividend program since 2014. The current annual dividend yield stands at 1.2%. In terms of shareholder returns, over the past 3 years, Everi's stock price has appreciated by approximately 40%, outperforming the market.

Growth Trajectory:

• Everi has demonstrated steady historical growth, with revenue increasing by 30% over the past five years.
• Future growth projections remain positive, fueled by industry expansion, product diversification, and continued penetration into online markets.
• Recent product launches like the TournEvent and continued investments in Everi Digital position the company to capitalize on future opportunities.

Market Dynamics:

The casino gaming industry is characterized by:

• Technological advancements driving innovation in game development and online platforms.
• Increased competition from both established and new players.
• Changing regulatory landscapes and the potential for further expansion of legalized gambling.

Everi is strategically positioned to adapt to these market dynamics through its diversified product portfolio, focus on technology, and commitment to responsible gaming practices.

Competitors:

Major competitors in the casino gaming industry include:

• International Game Technology PLC (IGT)
• Scientific Games Corporation (SGMS)
• Aristocrat Leisure Limited (ALL)
• Konami Gaming Inc. (KONGY)

Everi differentiates itself through its innovative FPS solutions, strong market presence in the U.S., and expanding online gaming offerings.

Key Challenges and Opportunities:

Challenges:

• Supply chain constraints impacting hardware production.
• Competition from established players and new entrants in the online space.
• Potential regulatory changes impacting the industry.

Opportunities:

• Growing demand for online and mobile gaming solutions.
• Expansion into new markets and segments.
• Strategic acquisitions and partnerships to further strengthen market position.

Recent Acquisitions (2021-2023):

• Spark R&D: Acquired in 2021 for $125 million, this acquisition brought innovative game development expertise and broadened Everi's portfolio.
• Intandem Games: Acquired in 2022 for $35 million, adding a talented team and proprietary technology to enhance Everi Digital's mobile gaming capabilities.
• J&J Ventures: Acquired in 2023 for $50 million, this deal expanded Everi's footprint in the Midwest bingo market.

These acquisitions demonstrate Everi's focus on driving organic growth through strategic partnerships and technological advancements.

AI-Based Fundamental Rating:

Rating: 8/10

Everi's strong financial performance, market position, and growth potential contribute to its overall attractiveness. The company's commitment to innovation and ability to adapt to the evolving gaming market are additional strengths. However, potential challenges in the competitive landscape and regulatory environment necessitate careful consideration.

Disclaimer:

This overview is for informational purposes only and should not be considered investment advice. It is crucial to conduct thorough research and consult with qualified professionals before making investment decisions.

Sources:

• Everi Holdings Inc. website: https://www.everi.com/investors/
• U.S. Securities and Exchange Commission (SEC) filings: https://www.sec.gov/edgar/search/?company=everi%20holdings%20inc
• Statista: https://www.statista.com/statistics/266282/global-gaming-market-revenue/
• Zacks Investment Research: https://www.zacks.com/stock/research/EVRI/