Why this stock has surged 14% amid the market downturn

Key points

• Genius Sports stock has jumped 14% in recent days.

• A major catalyst is its outlook for this fiscal year.

• Wall Street analysts are bullish on the stock.

This might be one stock to put on your radar

While the U.S. stock markets have fallen sharply in recent weeks, there have been some bright spots out there, including Genius Sports (NYSE:GENI).

Genius Sports, a data, technology, and broadcast provider to the sports betting industry, partners with some 400 organizations, including the NFL, EPL, FIBA, NCAA, NASCAR, AFA and Liga MX – along with the leading online sports betting companies.

Genius stock has soared some 14% over the past few days – and analysts are bullish about its prospects, despite the fact that it missed earnings estimates by a fairly wide margin. Here’s why.

Revenue hit but earnings miss

It was a bit of a mixed quarter for Genius Sports as it recorded revenue of $175.53 million, up 38% year over year. This barely beat estimates of $175.52.

Its largest business line, betting technology content and services, saw revenue spike 48% to $128 million, while sports technology and services jumped 47% to $12 million. Media technology content and services revenue rose 4% to $28.5 million.

For the full year, revenue rose 24% to $511 million, with betting technology content and services rising 29% to $355 million.

Earnings, however, missed estimates, as Genius posted a $28 million net loss in the quarter. That was better than the $38 million net loss in the same quarter a year ago. But earnings of -12 cents per share were below estimates of +4 cents per share.

For the full year, Genius had a net loss of $63 million, or -27 cents per share, which was about 26% better than the previous year.

Mark Locke, Genius Sports co-founder and CEO, said 2024 was a “defining year” that laid the foundation for sustainable growth and profitability in the year ahead.

“We have consistently exceeded expectations, bolstered our technology advantage, and strengthened our balance sheet, now positioning Genius Sports for continued success in 2025 and a clear path to achieve greater scale,” Locke said.

Among the highlights, it launched Next Gen Stats-powered in-stadium highlights for the Los Angeles Rams; powered the “EA Sports Madden NFL Cast” on Peacock; and executed the “NBA 2K25 DataCast” for the 2024 Emirates NBA Cup, streamed live on truTV & Max.

Analysts are bullish

Why analysts are so bullish on Genius is because of its robust growth outlook. The company expects to generate revenue of approximately $620 million this fiscal year, which would be a 21% increase over the previous year.

Further, adjusted EBITDA is targeted at approximately $125 million, which would represent 46% year-over-year growth.

This guidance exceeded estimates and led to several price target upgrades. Ryan Sigdahl, an analyst Craig-Hallum, boosted the price target for Genius to $15 per share – from %14 per share. That suggests 58% growth from its current price of $9.48 per share.

According to Investing.com, Sigdahl said the guidance surpassed his expectations. He cites a combination of positive factors propelling Genius Sports stock higher, including growth in online sports betting, pricing benefits, and new products. Sigdahl highlighted the company’s pricing power as a significant contributor to the healthy outlook.

Overall, analysts have set a median price target of $12 per share, which would be a 27% increase. Even the low end of the range, $11 per share, suggests a 17% stock price increase.

The company is not profitable, but it certainly seems to be headed in that direction. Given its unique advantages in a growing industry that’s not really impacted by an economic downturn, it is one stock to put on your radar.