Citizens has trimmed its 12-month price objective on Genius Sports Ltd. (GENI) to $11.00 from $17.00 but kept a Market Outperform rating on the shares. The stock is changing hands at $6.09, having declined 27.41% over the previous week and trading close to its 52-week low of $6.00.
The analyst adjustment follows Genius Sports’ announcement that it will use leverage to fund its acquisition of Legend, a digital sports and gaming media network. Some investors have characterized that move as a sizable wager intended to scale the business, potentially by adding earnings whose quality the market will need to evaluate.
Citizens analyst Jordan Bender highlighted a key detail in the company’s leverage targets: the figures disclosed reflect gross leverage rather than net leverage. Bender noted the firm’s view that net leverage should decline to below 1x by 2028, a development Citizens regards as favorable.
In the days after the transaction was announced, Citizens’ analysts conducted conversations with Genius Sports representatives and with industry participants to better understand Legend’s business model and how it will be folded into the combined entity. After those discussions, Citizens said it had "a greater appreciation for the pro forma business," while also acknowledging that "the learning curve for investors will take time" as stakeholders evaluate the strategic combination.
Under the terms disclosed by Genius Sports, the company agreed to acquire Legend for up to $1.2 billion. The deal calls for $900 million to be payable at closing, composed of $800 million in cash and $100 million in stock. The announced financing package includes an $850 million Term Loan B used to support the cash portion of the consideration.
The market reaction to the financing and acquisition has prompted a range of analyst responses. Guggenheim reduced its price target for Genius Sports from $17.00 to $12.00 but retained a Buy rating. Truist Securities reaffirmed a Buy rating with a $15.00 price target after meetings in Boston with the company’s chief financial officer and investor relations manager; those meetings highlighted the company’s work on prediction markets, with Truist reporting no observed negative impacts and noting potential upside from that exploration.
Genius Sports has also continued to roll out product initiatives alongside its corporate development activity. The company launched its BetVision platform for tennis during the Australian Open, positioning a new interactive betting solution in a major sporting event.
Separately, Stifel initiated coverage on Genius Sports with a Hold rating and a $10.00 price target, pointing to the company’s recurring revenue base and the potential for operating leverage as key elements of its investment thesis. Collectively, these analyst moves and product and transaction announcements underscore an active period of strategic shifts and varied broker assessments for Genius Sports.
Sectors impacted: Sports media, gaming and betting technology, and capital markets involved in leveraged corporate financings.