Paddy Power Betfair (PPB): Game-on for new CEO

Paddy Power Betfair (PPB): Game-on for new CEO

Mike van Dulken, Head of Research at Accendo Markets, commented this morning:

Shares in Paddy Power Betfair are down 5% this morning as investors react to CEO Breon Corcoran stepping down after sixteen years with the group, the last 7 of which in the C-Suite. Traders are both shocked and unsure. Shock stems from losing an important figure and business driver, especially with last year’s merger. Uncertainty stems from whether Peter Jackson – CEO of Worldpay since March, CEO of Travelex 2010-2015 – and his wealth of financial and consumer experience (non-exec board member since 2016) will be enough to lead the gaming giant.

The shares are already off their worst levels (-8.6%), thanks to a combination of reassuring hint about tomorrow’s interim results (revenues +9%, underlying EBIDA +21%; 2017 trading in-line) and some understandable bargain hunting. But only after the shares tested July lows and traded their lowest since the Brexit vote. Today’s drop scupper the shares recent rebound, and extends the mid-June downturn, adding to a rocky ride for both it and peers over the last twelve months. Fierce competition and consolidation are one problem. A lack of major summer sporting events this year makes it a brace. A new man at the top makes it hat-trick of issues for PPB shareholders.

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