StockStory Flags Bally’s Debt and Slowing Growth Despite Rally
The publisher cited slower revenue growth, falling returns and cash outflows as reasons for caution after Bally’s six-month share gain.
Key takeaways
- Bally’s shares gained 27.5% over six months and beat the S&P 500 by 14.7%.
- StockStory cited slower revenue growth and falling returns on invested capital.
- The publisher said Bally’s used $396.5 million of cash over the last year.
Bally’s shares rose 27.5% to $13.93 over the past six months, outperforming the S&P 500 by 14.7%, according to StockStory. The publisher’s analysis argued that the rally does not offset several financial risks.
StockStory pointed to annualized revenue growth of 6.9% over the last two years, below Bally’s five-year trend. It also said the company’s return on invested capital fell by an average of 4.9 percentage points annually over the last few years.
The publisher said Bally’s used $396.5 million of cash over the last year. The company had $6.83 billion in debt and $653.4 million in cash on its balance sheet, figures StockStory said raised the possibility of a capital raise if fundamentals do not improve.
StockStory said it would remain cautious until Bally’s generates consistent free cash flow or announced financing plans materialize on its balance sheet. It also noted the shares traded at 13.6 times forward EV-to-EBITDA, a valuation the publisher considered to reflect substantial optimism.
This article was produced with the help of AI technology. Source: Yahoo Finance
