Gaming Realms (GMR:AIM) 37.4p

Gain to date: 18.3%

We highlighted the appeal of AIM-quoted games distributor Gaming Realms (GMR:AIM) just under a year ago on the back of its ambitious profit growth targets which we felt were being underappreciated by the market.

WHAT HAS HAPPENED SINCE WE SAID TO BUY?

The company followed up a strong first-half performance in the second half to post another record set of full-year numbers on 31 March. This, plus news of a £6 million share buyback, helped revive a share price which had faltered on concerns about the broader sector backdrop.

As a reminder, Gaming Realms is a leader in the business-to-business licensing and distribution of games to the regulated gaming market.

The company owns the intellectual property to the Slingo brand, a mix of slots and bingo and one of the most popular formats of online games.

Results for 2024 revealed content licensing revenue up 28% powered by 59% growth in North America, which now accounts for 54% of the total. Crucially the company also reported a strong start to the current year with licensing revenue up 22% in the first two months of 2025.

Peel Hunt analyst Ivor Jones sums it up succinctly: ‘More games, partners, and territories – the winning formula continues to pay off.’

Despite doling out a material sum to buy back shares, the company remains in a robust financial position, giving it scope to look at M&A and other investment opportunities to drive growth.

WHAT SHOULD INVESTORS DO NOW?

We would stick with the shares given they remain on an attractive valuation – 10.5 times current-year earnings, based on consensus forecasts – and the company’s growth prospects continue to look solid. 

We will keep an eye on performance through the course of the year as comparatives look set to get tougher thanks to the bumper 2024 showing and will continue to monitor regulatory threats. 

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