Playtika (NASDAQ: PLTK) shares jumped more than 21% after Bank of America issued a double upgrade on the Israeli-based mobile game developer, raising its rating from Underperform to Buy.

The upgrade reflects confidence in Playtika’s profitability, financial strength, and long-term growth prospects within the mobile gaming industry.

“PLTK boasts the industry’s highest profitability (30% EBITDA margins), the industry’s largest DTC platform, and three of the largest and longest-running franchises in mobile gaming history. It operates within the mature, but still growing mobile gaming industry, which we expect to grow at least 4% Y/Y for the foreseeable future,” BofA Securities analyst Omar Dessouky said.

BofA’s optimism is supported by Playtika’s next twelve months (NTM) free cash flow yield of 21% and a dividend yield of 9%.

These metrics suggest limited downside risk and underscore the management’s ability to sustain strong financial performance.

Playtika’s share price performance

Playtika has struggled significantly in the past month, with its share price plunging 42%.

Despite Wednesday’s rebound, the stock remains down about 23% compared to a month ago.

This decline adds to a challenging year for shareholders, as Playtika’s stock has fallen 24% over the past 12 months.

Following this sharp drop, Playtika’s valuation appears relatively low.

With roughly half of US companies trading at a price-to-earnings (P/E) ratio above 18x, Playtika’s 9.3x P/E may suggest an attractive investment opportunity.

However, the company’s weak earnings performance has weighed on investor sentiment.

While many firms have posted growth, Playtika has struggled, leading to scepticism about its ability to turn things around. The low P/E likely reflects concerns that its earnings challenges will persist.

Q4 and full-year earnings reflect challenges

Playtika reported a Q4 2024 revenue of $650.3 million, marking a 4.8% sequential increase and a 1.9% year-over-year growth.

However, the company recorded a net loss of $16.7 million, a decline compared to previous periods.

Credit Adjusted EBITDA stood at $183.9 million, down 6.7% sequentially and 2.6% year-over-year.

For the full fiscal year 2024, Playtika’s revenue totaled $2.55 billion, slightly lower than the $2.57 billion recorded in 2023.

Net income for the year declined to $162.2 million from $235.0 million, while Credit Adjusted EBITDA dropped from $832.2 million to $757.7 million.

Despite these challenges, Playtika’s DTC platform saw strong performance, with Q4 revenue of $174.6 million, reflecting 8% year-over-year growth.

Average Daily Paying Users (DPUs) increased 12.6% sequentially to 339,000, while payer conversion improved to 4.2%.

Mixed results across game categories

Playtika’s casual games segment recorded an 11.6% sequential and 11.3% year-over-year revenue increase, driven by strong performances from Bingo Blitz and Solitaire Grand Harvest.

However, its social casino-themed games segment saw a 4.9% sequential and 10% year-over-year revenue decline.

Among its top-performing titles, Bingo Blitz generated $159.1 million in revenue, Slotomania contributed $118.4 million, and Solitaire Grand Harvest earned $72.5 million.

Dividend and outlook for 2025

Playtika announced a quarterly dividend of $0.10 per share, payable on April 4, 2025, reinforcing its commitment to returning value to shareholders.

Looking ahead, the company expects FY2025 revenue between $2.80 billion and $2.85 billion, with Credit Adjusted EBITDA ranging from $715 million to $740 million.

Management remains focused on strategic acquisitions, disciplined capital allocation, and leveraging its DTC platform for future growth.

The post Playtika stock soars 21% after BofA double upgrade: what investors need to know appeared first on Invezz

Brazil has postponed its plan to tax major tech firms over concerns that it could be seen as retaliation against escalating US trade threats from President Donald Trump.

According to Reuters, sources familiar with the matter said Brazil now intends to push forward a new legislative proposal aimed at regulating competition among dominant internet platforms in Latin America.

Amid domestic economic challenges and shifting international trade dynamics, the new administration is steering away from its predecessor’s foreign policy approach.

Draft competition bill on digital market practices

On October 4, 2024, Brazil announced the implementation of a minimum 15% tax on the profits of multinational corporations, as detailed in an executive order published in the country’s official gazette late Thursday.

This initiative aimed to bolster revenue in light of the government’s ambitious goal of achieving a zero fiscal deficit while avoiding broad spending cuts that could jeopardize essential social programs.

By aligning with global efforts to combat tax evasion, Brazil was seeking to stabilize its financial framework and ensure fair taxation for multinational entities.

The government is currently consulting on draft competition legislation aimed at anti-competitive business practices that hinder fair competition between consumers but has proposed to take into account a proposal for an amendment in public consultation (January 2024).

The bill is intended to prevent harm like “killer acquisitions,” in which a big company buys up potential competitors for the express purpose of killing them and favoring a platform’s products in the search results.

Brazil aims to foster a competitive environment to boost innovation and offer better choices to consumers in its booming digital economy.

This focus on competition comes as regulators across the world are adjusting their frameworks to respond to the rapid expansion of technology companies, demanding more accountability and fairness in digital markets.

Tax proposal raises concerns about trade relations

Previously, Brazilian officials hinted that they would present a tax plan targeting major global technology businesses, depending on federal income predictions for the second half of 2024.

If passed, this tax will affect big US-based firms like as Amazon, Alphabet’s Google, and Meta, which operates Facebook and WhatsApp.

However, as one of the insiders said, the timing of the tax plan has caused alarm in the Brazilian administration.

The volatile picture of US-Brazil trade ties, particularly following President Trump’s announcement of probable tariff increases on April 2, has made Brazil more cautious.

The person emphasized that rising taxes on big US corporations could disrupt existing trade conversations and negotiations, particularly in light of Trump’s strong tariff program.

Managing uncertainty in international trade

The government’s push for such a policy, as Brazil braces for possible tit-for-tat scenarios resulting from hikes in US tariffs, is ultimately part of a wider aim of keeping trade tensions from heating up.

Brazilian officials, meanwhile, are seemingly unclear about the exact nature of the threats and how they will influence the future of trade relations between the two countries.

The backdrop of international trade systems and talks emphasizes Brazil’s vulnerable situation.

By rejecting the tax plan for IT titans, Brazil appears to be aiming to retain a cooperative stance with key economic partners while also addressing local concerns about competition and justice in the digital economy.

Brazil might look for a more balanced approach

The Brazilian government’s new focus on competition regulation rather than taxation represents a strategic recalibration.

While it addresses domestic concerns regarding market inequities and anti-competitive practices, it also seeks to maintain constructive trade relations with the United States amid prevailing uncertainties.

As the digital economy expands and evolves, Brazil’s legislative developments will undoubtedly be closely watched by both domestic and foreign parties.

The conclusion of the public consultations on the competition bill will be critical as Brazil works to build a more equitable digital landscape while still pursuing its economic interests on a global scale.

The post Brazil delays big tech tax proposal amid US trade tension concerns appeared first on Invezz

Dunne Insights chief executive Michael Dunne continues to see several reasons to hope for further upside in BYD even though the EV stock has already soared some 100% in the trailing 12 months.

For one, the Chinese electric vehicle giant is “achieving the most explosive growth we’ve seen in the auto business in a hundred years,” he told CNBC in a recent interview.

BYD shares have inched down a little in recent sessions only because investors opted to take some profits off the table since “this thing has been on fire,” Dunne added. 

BYD is the world’s third most valuable automaker

Michael Dunne remains incrementally bullish on the future of BYD because its vehicles continue to sell like hotcakes.

The EV maker expects to sell a total of 5 million vehicles this year – up sharply from 400,000 only in 2020.

At the time, it also had zero exports, but now “there’s no market where they’re not, outside of the US and Canada.”

In fact, Shenzhen-based BYD is now the world’s third most valuable automaker, behind Tesla and Toyota only.  

Dunne expects BYD shares to resume their upward trajectory in the coming weeks since “it’s a company that has tremendous momentum” and is growing its top and bottom line at an accelerated pace.

BYD’s revenue surpassed $100 billion before Tesla

BYD stock is attractive also because it continues to threaten Tesla’s dominance in the EV market.

Earlier this week, the Chinese behemoth reported about $107 billion in revenue for 2024 – well ahead of Tesla at less than $98 billion only.

According to its chairman Wang Chuanfu:

BYD has become an industry leader in every sector from batteries, electronics to new energy vehicles, breaking the dominance of foreign brands and reshaping the new landscape of the global market.

Earlier in March, BYD also said its latest technology can charge its vehicles for about 249 miles in just five minutes.

A standard Tesla typically takes 15 minutes, and that is for about 168 miles only.

BYD is challenging Tesla on autonomous features

Dunne recommends owning BYD stock at current levels because it’s “innovating aggressively.”

BYD has recently launched a new DeepSeek-enabled advanced driver assistance system (ADAS) dubbed “God’s Eye”, which many believe may be better than Tesla’s FSD.

Why? Because the firm’s new offering is based on LiDAR sensors versus Tesla’s camera-based approach, which costs more but can still fail to deliver optimal results in low-light or complex urban scenarios.

Note that BYD is a company that, as Charlie Munger (influential investor Warren Buffett’s trusted partner and right-hand man) once said, was “so far ahead of Tesla, it’s ridiculous.”

Wall Street also currently has a consensus “buy” rating on BYD stock.

The post This automaker is seeing the most explosive growth in 100 years: here’s why appeared first on Invezz

US President Donald Trump has announced new import tariffs of 25% on cars and car parts, a move that threatens to escalate global trade tensions.

The tariffs will take effect on April 2 for vehicle imports, with levies on parts expected to follow in May or later.

Trump defended the decision, arguing that it would stimulate the US auto industry by creating jobs and attracting investment.

However, analysts warn that the policy could backfire by disrupting global supply chains, increasing vehicle prices, and straining relations with key allies, including Japan, South Korea, Germany, and Mexico.

The tariffs are also expected to drive up the cost of vehicles sold in the US.

Analysts at Bernstein estimate that the new levies could add as much as $75 billion per year to automakers’ expenses, costs that will likely be passed on to consumers.

Middle-income buyers will bear the brunt of these price increases.

Affordable models such as the Chevrolet Trax, which is manufactured in South Korea, may become out of reach for many American buyers.

“The folks at the lower end of the buying pool are going to suffer the most,” said Erin Keating, executive analyst at Cox Automotive.

Asian automakers hit as stocks tumble

Asian car manufacturers were among the hardest hit following Trump’s announcement.

Toyota and Honda shares fell by 2.74% and 3.05%, respectively, while Nissan, which has two plants in Mexico, dropped 1.84%.

Mazda Motor suffered the sharpest decline, plunging over 6.4%, while Mitsubishi Motors also saw a 4% drop.

South Korean automakers also faced a downturn, with Kia Motors sliding over 3%. Kia, which operates a manufacturing facility in Mexico, faces significant exposure to the tariffs.

Chinese automakers were not spared either, with Nio falling 3.94% and Xpeng losing 1.97%.

In India, Tata Motors, owner of Jaguar Land Rover (JLR), saw its shares crash more than 6% amid fears that the company’s US sales would take a hit.

Hyundai and Kia could see their margins take a hit

Credit ratings agency CreditSights warned that Hyundai Motor and its affiliate Kia could face financial strain from the tariffs.

The 25% levies could push their global operating margins down to less than 6% from a projected 9%, potentially triggering credit rating downgrades.

The tariffs could affect 60% of the vehicles Hyundai-Kia sells in the US, with an estimated cost increase of 25% per unit.

The group can likely only pass 5% of the projected cost increase, and the impact of the tariffs could wipe out its US profitability, the agency said.

Despite investing $21 billion in US expansion plans, Hyundai still imported over a million vehicles into the US last year, accounting for more than half of its American sales.

According to SK Securities analyst Hyuk Jin Yoon, the two South Korean carmakers may have to pay as much as 10 trillion won ($7 billion) annually in tariffs, wiping out nearly 40% of their operating profits.

Toyota and Volkswagen also vulnerable

Toyota, the world’s largest automaker, is also at risk despite having extensive US manufacturing operations in Kentucky, Indiana, Mississippi, Texas, West Virginia, and Alabama.

The company still imports about half of the vehicles it sells in the US.

Volkswagen, Europe’s top carmaker, is similarly vulnerable.

S&P Global Mobility estimates that 43% of Volkswagen’s US sales originate from Mexico, making it a key target of Trump’s trade policy.

Ford to face less severe impact than rivals

Ford Motor Co. could also face a less-severe impact than some rivals, with about 80% of the cars it sells in the US being built domestically.

However, the carmaker builds its entry-level Maverick small pickup in Mexico as well as the Bronco Sport compact SUV and Mustang Mach-E electric vehicle.

General Motors imports certain Chevrolet Silverado pickup trucks from its facilities in Mexico and Canada, along with the entry-level Chevy Trax compact SUV from South Korea and the Chevrolet Equinox crossover SUV.

Both the Equinox and Trax, which rank among GM’s most affordable models, saw sales exceed 200,000 units last year.

Additionally, the company manufactures electric versions of the Equinox and Blazer in Mexico.

Stellantis NV, meanwhile, produces the Jeep Compass and Wagoneer S SUVs in Mexico, making it another major player affected by the tariffs.

Tesla could emerge as a winner among losers

Among the hardest-hit automakers, Tesla appears to be a rare beneficiary of the new tariffs.

The electric vehicle giant produces all its US-sold cars domestically at factories in California and Texas, shielding it from the 25% levies.

While Tesla may still face higher production costs due to tariffs on imported parts, its relative insulation from foreign car imports gives it a competitive edge over rivals.

Trump dismissed speculation that Tesla CEO Elon Musk influenced the tariff decision, stating, “He’s never asked me for a favor in business whatsoever.”

The post From Hyundai, Kia to Tesla: here’s how Trump’s auto tariffs will hit carmakers appeared first on Invezz

Next has become one of the few British retailers to surpass £1 billion in annual profit, reporting a pre-tax figure of £1.011 billion for the year ending January.

This marks a 10.1% increase from the previous year’s £918 million, placing the high street fashion retailer in the same league as Tesco, Marks & Spencer, and B&Q owner Kingfisher.

The strong results come as the company recorded an 8.2% rise in total sales to £6.3 billion, with full-price sales growing by 5.8%.

NEXT share price jumped more than 8% on the positive announcement.

The retailer credited robust consumer demand and strategic business decisions for its impressive performance.

NEXT raises profit forecast for current year

Buoyed by stronger-than-expected trading in the first eight weeks of the new financial year, Next has raised its profit forecast for the current year by £20 million to £1.07 billion, an expected 5.4% increase.

The company also revised its sales growth projections upward, now expecting a 5% rise in total sales and a 6.5% increase in full-price sales, compared with previous estimates of 3.5%.

Chief executive Simon Wolfson emphasized that achieving a £1 billion profit milestone would not alter the company’s disciplined approach to business.

“Reaching any level of profit cannot be used as an excuse for being less demanding in our approach to running the business,” he told investors.

Wolfson reiterated that Next must remain rigorous in cost control, margin management, and capital allocation to sustain long-term profitability.

Wolfson tempers celebration, warns of economic risks

Despite the company’s financial success, Wolfson played down the significance of crossing the £1 billion profit threshold.

“To some, it may seem an important milestone, even a cause for celebration. We do not share that view, not least because profits can go down as well as up,” he said.

Wolfson illustrated the company’s approach with an anecdote from an employee who had hoped that Next’s £1 billion earnings would justify additional spending.

“A colleague, frustrated at the cost constraints they worked within, was heard to say, ‘Surely, now we are making a billion, the company can buy me a new laptop.’ Buying that laptop may well have been a good investment, but reaching £1 billion profit does not make it more worthwhile,” he remarked.

Rather than focusing on profit milestones, Wolfson pointed to the company’s long-term goal of growing earnings per share (EPS), which has risen twenty-nine fold over the past three decades—from 22p to 636p.

Retail recovery and future challenges

Reflecting on the past year, Wolfson noted that 2024 marked a turning point for the retail industry.

“It is unusual for Next to begin a year on an optimistic note, yet that was our stance this time last year,” he said.

He attributed the company’s positive outlook to a stabilizing retail landscape, the fading impact of the pandemic, and an easing cost-of-living crisis.

However, he acknowledged that broader economic risks remain.

“We are as positive about the company today as we were then, albeit in an environment where the risks to the wider UK economy are growing.”

While Next remains confident in its strategy, it is preparing to navigate potential challenges posed by inflation, consumer spending fluctuations, and global economic uncertainties.

The post Next joins £1 billion profit club as sales surge; NXT stock jumps 8% appeared first on Invezz