MKM sees near-term risks for Playtika in buyout interest remains bleak

Playtika Holding

03/05/2022 11:37

** MKM Partners cuts target price for mobile gaming co
Playtika Holding Corp  PLTK.O  to $25 from $29
    ** New PT marks a 42% upside to stock's last close vs a 65%
upside to previous PT
    ** Brokerage says PLTK needs to find a buyer who could bid
for the entire co, or buy shares from its majority shareholder 
Yuzhu Shi 
    ** Affiliates of Shi, who is the largest stockholder of
PLTK, said in January they were exploring a sale of a portion of
their holdings
    ** Without a buyer, stock's upside potential will be limited
as Shi continues to sell down his position, MKM says
    ** Brokerage also says the video games industry is going
through a period of "multiple contraction", which is impacting
PLTK shares
    ** Multiple contraction occurs when a company's profits
increase without a proportionate jump in its stock price
    ** Potential for growth of PLTK's games portfolio, however,
remains strong, MKM adds
    ** YTD, PLTK shares have gained 1.8%

 (Reporting by Niket Nishant in Bengaluru)
 ((Niket.Nishant@thomsonreuters.com;))