Investors are urged to ignore an 81% tumble in the share price for an up-and-coming Australian company that's headed for a bright future.
Bluebet Holdings Ltd (ASX: BBT) has seen its stock price tumble from $2.86 on 25 August 2021, to now just 54 cents, less than a year later.
However, Red Leaf Securities chief executive John Athanasiou recommends punters buy the stock while it's going for cheap.
"This sports betting technology company had cash and cash equivalents of about $51 million at the end of the third quarter of fiscal year 2022," he told The Bull.
Massive growing market in the USA
The betting provider is a participant in the land grab in the lucrative US market, as individual states move to legalise sports gambling.
"Bluebet is expanding in the lucrative US market," said Athanasiou.
"It recently signed a 10-year market access agreement to operate in Indiana."
Another bonus is that Bluebet plays in an industry that can endure an economic downturn, should rising interest rates start to impact Australian and American consumers.
"Gambling stocks traditionally do well during challenging times, and we believe this will be the case with Bluebet."
Bluebet's 'longer-term potential is significant'
Athanasiou is not the only one keen on Bluebet.
According to CMC Markets, both Morgans and Ord Minnett rate the stock as a strong buy.
Morgans senior analyst Alexander Mees explained last month how much his team is looking forward to Bluebet's annual report.
"The longer-term potential is significant," he said.
"Bluebet's Australian business is forecast to achieve strong growth in turnover in FY22 (48%) as it increases marketing costs to drive customer acquisition."
Bluebet is due to report its numbers on 30 August.
The company was founded by bookmaker Michael Sullivan, who is now executive chair and holds more than 40% of the shares.
He was formerly the chief executive of Sportingbet, which he grew into a multi-billion dollar business.
