Betsson

In one line: Statistically the cheapest name in the universe at 5.6× EBIT, and the cheapness never closes because the historical margins were earned in markets that are now regulating.

The headline numbers are arresting: 5.6× EV/EBIT, 8.2× earnings, a 10% free cash flow yield and a 7.9% dividend. The screen scored it at 25% return on capital and 21% operating margins.

Those margins are gone. The most recent quarter set a revenue record, up 2.1% — and operating income fell 38.9%, with the EBIT margin dropping from 22.7% to 13.6%.

The cause is structural rather than cyclical. Regulated markets went from 65.7% to 75.5% of group revenue in a single year, carrying roughly €15m of additional gaming taxes and higher payment-provider fees with them. In other words, part of the historical return came from operating where tax is light, and that arbitrage is closing as the mix regulates. This is a permanent reset of the earnings base, not a soft patch.

The apparent value is also not new information:

It has traded at six to eight times operating profit every year since 2022. The discount is a permanent feature, not an opportunity, and being below its 200-week average tells you nothing about a share the market has consistently refused to re-rate. The payout ratio is around 69% against falling earnings.

The lesson worth keeping: this was screened on annual data through 2025, and the 2026 quarterly data is what broke it. A quality screen needs a has-this-broken-since-year-end check bolted on.