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888 Stocks Jump on South Africa News

May 13, 2009 (CAP Newswire) — Yesterday, 888 Holdings Plc’s B2B unit, Dragonfish, announced a new strategic partnership with South African-based Phumelela Gold Enterprises (PGE), one of the world’s largest pari-mutuel horseracing and tote betting organizations. (Read about that news here.)

Today, the market responded by bumping up 888’s stock numbers 2.5 percent. This continue a welcome trend of impressive financial performance for European online gaming companies that’s most likely being fueled by the United States’ warming to the idea of legalizing and regulating the pastime.

The Dragonfish deal will allow 888 to access the South African market, a prime area for activity that many observers are anticipating will grow as regulation comes more fully into play in that nation.

Numis Securities said that "we would expect the shares to respond positively to this agreement and to narrow the around 50 percent 2010 EBITDA valuation discount to its bigger peer, PartyGaming”, according to an article filed by Reuters news service.

Also according to the Reuters article, the Daniel Stewart & Company firm commented: "A cornerstone of 888's growth strategy is expansion of its B2B offering and it is making good headway. This deal should further underpin our current estimates of 2009 EPS of 12.65 cents, placing the shares at 12.5 times 2009 and 10 times 2010."

Click here to read the original report from Reuters.