Monday, May 16, 2016

Amaya reports 1st quarter earnings

Link:

Amaya remains focused," said Rafi Ashkenazi, Interim Chief Executive Officer of Amaya. "During the first quarter, we continued to execute on our growth plans despite unexpected challenges, including management changes and the ongoing strategic alternatives process. We attracted new customers to PokerStars, continued to introduce changes to improve the overall poker experience, expanded our online casino offering and continued to invest in our emerging online sportsbook."

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The Special Committee's review of strategic alternatives is active and ongoing, with the goal of determining the best outcome for Amaya and its shareholders. Specifically, the Special Committee's financial advisor, Barclays Capital Canada Inc., has contacted a range of strategic and financial parties who might be interested in a transaction involving Amaya. To date, several parties, including David Baazov, who is on a leave of absence as Chairman and Chief Executive Officer of Amaya, have entered into confidentiality agreements with Amaya. A number of these parties have received management presentations and are conducting due diligence. 

I like this stock due to its commanding lead in online poker. Recently the company has added an online casino and sports book which is doing great. I am expecting the company to be taken private by the CEO or to be bought by another company as a result of the strategic alternatives action being taken by the board. I expect the price to be substantially higher than the current price. I was able to pickup shares in the $12 range due to the over reaction to the insider trading charges brought against the CEO who is currently on leave of absence. The regulator is pursuing the CEO and this had nothing to do with the company itself. Nevertheless the price of stock dropped as people sold. Their misinformed action was my gain as the stock has reacted nicely by 7% on this earnings news.

Link to earnings presentation 

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