NEW YORK - Lottery.com Inc. (NASDAQ:LTRY), a technology firm specializing in lottery and sports media content delivery, has announced a strategic partnership with Cohen & Company Capital Markets (CCM) to enhance its acquisition strategy. The collaboration, which began on May 6, 2024, aims to bolster Lottery.com's global presence by targeting acquisitions that would expand its product offerings and market reach.
The company's "buy and build" strategy is supported by a $150 million loan facility from United Capital Investments Limited, with additional backing from investors like Prosperity Investment Management. CCM's role will be to guide Lottery.com through potential acquisitions and business combinations to strengthen its domestic and international operations.
A key focus of this expansion is the development of Sports.com into a premier streaming platform for live sports events. The platform, which recently launched its app on Apple (NASDAQ:AAPL) and Google (NASDAQ:GOOGL) App Stores, is looking to acquire and grow soccer clubs, particularly in the UK market, to enhance brand development through Sports.com.
Marc Bircham, Director of Sports.com and former professional soccer player, expressed enthusiasm about working with CCM to lead the Sports.com acquisition program. Matthew McGahan, CEO and President of Lottery.com, highlighted the importance of CCM's expertise in financial structuring and fundraising for the company's global expansion and acquisition strategy.
Lottery.com's vision includes revolutionizing fan engagement through live event streaming on Sports.com, with a particular focus on motor sports and mainstream American sports. The company is also targeting the soccer market, with plans to acquire a UK football club within the year.
The company's strategy will utilize the $150 million loan facility approved by shareholders in November 2023 and new capital structures introduced by CCM. This financial leverage is expected to drive international lottery ticket sales and expand the Sports.com audience, aiming to monetize online assets and technical expertise through structured acquisitions.
This announcement is based on a press release statement from Lottery.com.
InvestingPro Insights
As Lottery.com Inc. (NASDAQ:LTRY) embarks on its ambitious acquisition strategy to expand its global footprint, the company's financial health and market performance are critical factors for investors to consider. With a market capitalization of just $8.45 million, the company appears to be on a delicate footing, particularly with a Price / Book multiple of 0.21 as of the last twelve months ending Q4 2023, which suggests the stock is trading at a low valuation relative to its book value.
InvestingPro data shows some challenges for the company, with a negative Price/Earnings (P/E) ratio of -0.31, indicating that investors are not expecting earnings growth in the near term. Moreover, the company's revenue has seen a decline of 4.37% over the last twelve months as of Q4 2023, while its gross profit margin stands at 14.46%, reflecting potential inefficiencies or competitive pressures in its operations.
Two critical InvestingPro Tips for Lottery.com highlight potential concerns: the company may have trouble making interest payments on its debt and is quickly burning through cash. These tips suggest that while the strategic partnership and acquisition plans could provide long-term benefits, the company's immediate financial stability is uncertain. Investors looking for a more comprehensive analysis of Lottery.com's financial situation and future prospects can find an additional 13 InvestingPro Tips by visiting InvestingPro, and can use the coupon code PRONEWS24 for an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
Given the recent stock price volatility, with a significant drop of over 25% in the last three months, stakeholders should tread carefully and monitor the company's ability to execute its growth strategy without compromising its financial health.
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