The first is financial data and trading specialist London Stock Exchange Group (LSE: LSEG). Its shares struggled last year, over concerns that artificial intelligence (AI) would erode its data business. Critics also argued it had been slow to roll out its own AI tools, despite its partnership with Microsoft.

London Stock Exchange Group shares slump

This month, AI fears returned with force. Virtually every FTSE 100 financial data stock slid as investors worried that advanced tools from firms such as Anthropic could disrupt their business models. LSEG was one of them.

Its share price has plunged 18% over the last month and is down 37% over the year. It’s now bouncing around as markets debate whether the sell-off has gone too far.

The stock got a brief lift Wednesday (11 February) on reports that activist hedge fund Elliott Management had built a stake and may push for a multi-billion-pound share buyback and tighter margins. Consensus forecasts are now supremely bullish, suggesting 63% upside from here. But I don’t fully trust them. Many of the 17 analysts will have set their targets before the latest bout of turmoil.

The P/E has fallen into the 20s, which is more reasonable. If the AI panic passes, this could have proven a brilliant buying opportunity but as AI menaces it feels like a wild leap in the dark today.

Can Entain bounce back?

Brokers are even more bullish on gambling group Entain (LSE: ENT). Eighteen analysts have issued one-year targets, and the median number of 1,015p is nearly 65% above the current 617p. Again, scepticism’s called for. The Entain share price has been turbulent lately, and many forecasts may pre-date recent slippage.

Entain’s troubles include a £585m settlement following a bribery probe into its former Turkish business, while tighter regulation in the UK and Netherlands squeezed profits. November’s Budget hiked UK online gambling duties, costing around £200m annually. The Entain share price is down 15% over one year and more than 50% over three.

Yet full-year 2025 numbers are promising. On 4 February, Entain reported 33% net revenue growth to $2.8bn and guided for $3.1bn to $3.2bn in 2026. EBITDA earnings swung from a $244m loss to a $220m profit. The board anticipates EBITDA will climb as high as $350m in 2026 then power on to $500m in 2027.

Again, there are risks. Gambling will always face tax and regulatory pressure and Entain must work hard to keep its nose clean. With a P/E around 20, it’s not cheap. Yet it does have a major US opportunity through BetMGM, its joint venture with MGM Resorts. It’s worth considering for investors happy to back gambling stocks but it’s at the higher end of the risk spectrum. Not for everyone.

The post These 2 UK stocks are forecast to rocket 65% this year – time to consider buying them? appeared first on The Motley Fool UK.

Entain shares plunge

The first is gambling and sports betting group Entain (LSE: ENT). I ran the rule over it last June, after the board upgraded its revenue forecast for BetMGM, its 50:50 joint venture with MGM Resorts.

Broker UBS was enthusiastic. It argued that while Entain was steadily improving operationally, the shares were still trading at a 20% discount to rivals. UBS upgraded the stock to Buy and lifted its target price to 920p. Oops. Today, Entain trades at 600p. Over one year its shares are down 13.7%, and 60% over three.

I’m not a huge fan of betting shares and it didn’t help that Entain had to stump up £585m following a bribery probe linked to its former Turkish business in 2023. Tighter gambling rules in the UK and Netherlands have weighed on profits, while fears of higher UK taxes came true in November’s Budget. Remote gaming duty was almost doubled, from 21% to 40%. Entain estimates this will cost it £200m a year.

The shares still have plenty of fans. Nineteen analysts offering one-year forecasts produce an average target price of 1,013p. That’s almost 70% above today’s level.

After a tough year, Entain may be due a recovery. However, I suspect many of those forecasts pre-date the latest share price slide. With a price-to-earnings ratio of around 20, the shares are also more expensive than I expected. Entain could bring real excitement this year, and high-risk investors might consider a punt. But it still isn’t for me.

Experian plunges too

January’s other big loser was Experian (LSE: EXPN). As a credit bureau it operates in a more respectable line of work, but this stock turns out to be a gamble too.

Here, investors are worried about artificial intelligence. Experian owns vast amounts of consumer and business data, but will customers still pay if AI tools can provide similar answers?

On balance, I think they might. I’ve learned not to rely on ChatGPT for financial data. Even basic facts like stock P/E ratios or dividend yields can vary wildly depending on the source. It’s nowhere near ready to replace Experian’s proprietary data.

The board insists AI will actually work in its favour, by allowing it to enhance its services. Yet even after a $1bn share buyback gave the stock a lift on 30 January, it’s down 30% in a year.

Again, analysts appear optimistic about the year ahead, setting a one-year target price of 4,201p. That’s a blistering 52% above today’s 2,761p. As with Entain, many of these forecasts may predate the recent drop.

Despite its troubles, Experian has a P/E of 24. I think that’s a bit expensive for what may ultimately prove a binary bet on AI. I’ll look elsewhere for my next recovery play. I can see plenty of exciting opportunities on the FTSE 100, and with fewer risks. I’ll research them instead.

The post I dodged a bullet with these two crashing UK shares – should I buy them today? appeared first on The Motley Fool UK.

The average mooted price tag right now stands at 1,028p, which is more than 55% ahead of the Entain share price, at the time of writing. And the most optimistic analyst has 1,200p marked in for the stock — more than 80% ahead of today. So why aren’t investors snapping up Entain shares? Let’s take a closer look.

Entain’s a global sports betting and gaming company. It owns Ladbrokes and Coral, among others, in the UK, BetMGM in the US as part of a joint venture, and a number of other operators internationally.

Regulated industry

It operates in an industry that’s highly regulated, and has to deal with different rules in different countries. And a look at the share price chart above suggests regulatory fears might have put a lot of investors off this UK stock.

In fact, the budget here in the UK raised gaming and betting taxation, to be phased in over this year and next. Still, Entain’s international nature means it’s less exposed to individual country legislation.

And that seems to show in the most recent broker recommendations. Deutsche Bank, for example, has just cut its Entain share price target… but it’s still at 1,029p, down from 1,158p. Maybe it shows the uncertainty surrounding a share price like this. But to me it also suggests a decent baseline of confidence.

Forecast performance

At first glance, Entain’s forecast price-to-earnings (P/E) ratio of 29 for the 2025 year might look a bit steep. And based on October’s full-year guidance, it’s probably a fairly accurate estimate. We’ll know more from a year-end update on 4 February, with full results due 5 March.

But that valuation suggests analysts expect some impressive profit growth from Entain in the next few years. And, in fact, they do. For 2024 we saw a loss per share, but there’s a return to positive earnings per share (EPS) on the cards for this year. After that, forecasters see EPS more than doubling by 2027. And that could slash the P/E to around 14.

They also have the dividend growing 19% between 2024 and 2027, and well covered by earnings. The dividend yield‘s only a modest 2.9%, but it would be a nice extra.

Share price growth?

A lot could still go wrong before Entain truly gets back to growth. Especially with rising borrowing pushing governments everywhere to look for new sources of tax revenue. And, erm, unpredictable US administration, anyone? The sector faces long-term risk.

But those forecasts make me think this could be the best time we’ve seen for a while to consider Entain shares.

The post Can this strongly-tipped UK stock really soar 55% in 2026? appeared first on The Motley Fool UK.

We now head into another twitchy spell as investors fret about the artificial intelligence bubble, while Wednesday (26 November) brings the Budget. I’ve picked out three FTSE 100 names that could swing sharply depending on what the Chancellor announces.

Lloyds shares could slip

Lloyds Banking Group (LSE: LLOY) has enjoyed an impressive run. Its shares have risen 60% over the last year and 145% over five, with dividends on top.

It’s still making plenty of money, with full-year 2024 profits of £4.5bn. That was lower than 2023’s £5.5bn, but the drop was driven by one-off costs such as the £700m motor finance mis-selling provision. Management softened the blow with a £1.7bn share buyback, taking total capital returns for the year to £3.6bn including dividends.

In the Budget, Rachel Reeves could hit banks with a windfall tax, potentially increasing the surcharge on profits from 3% to 8%. The shares could move quickly in either direction depending on what she does. With a modest price-to-earnings ratio of about 13.9, I still feel Lloyds is worth considering for long-term investors, although they may prefer to wait and see what the Budget brings. It’s only three days away now.

EasyJet share price struggles

Budget carrier easyJet (LSE: EZJ) has struggled to recover from the pandemic, with its shares down 9.5% over the last year and 25% over five. It focuses on the European market, where consumers are still under the cosh, although bookings have held up pretty well and its new holidays division is performing strongly.

From April next year, it will be hit by an increase in air passenger duty, which is due to rise by 15% on most fares. The industry has been calling for Reeves to repeal that, although it seems unlikely to me. We just don’t know what she’ll do yet.

The current P/E is 7.5, so easyJet looks great value, but then it has done for several years without taking off. Investors may consider buying, but only if they’re planning to hold for the long haul to give it time to recover.

Entain is a gamble

With a P/E of 23, I’m probably stretching things to call gambling and gaming giant Entain (LSE: ENT) a value stock, yet I still think it has plenty of scope for a re-rating. Its shares are down about 3% over the last year and 45% over three, despite a huge opportunity in the US, where trading has been strong.

There’s been repeated talk of Reeves hiking taxes on so-called ‘sin stocks’, and if she does, Entain could take a hit. Although with the US making up a bigger part of its operations thanks to its joint venture BetMGM with MGM Resorts International, which is booming right now, it may not be too big a blow. We’ll see on Wednesday.

Lloyds is by far my favourite of the three. EasyJet and Entain are likely to be more volatile, but both could prove rewarding with a long-term view. There are plenty more FTSE 100 bargains worth watching. It’s going to be an absorbing week.

The post 3 FTSE 100 value stocks I’ll be watching like a hawk during the Budget appeared first on The Motley Fool UK.

In recent updates, Citigroup has put a 1,300p price target on betting and gaming group Entain (LSE: ENT). And Berenberg has gone one better, with a 1,400p price target.

Those are the two most recent price targets I can find, and they average 1,350p. That would mean a whopping 92.5% rise from market close on Tuesday (18 November).

Not everyone is quite as bullish, mind. Barclays earlier suggested a rise to 945p, which is a fair bit less enthusiastic. But that’s by far the lowest of the past few months’ targets. And even that suggests a 35% increase.

Price rise ahead?

Can this new broker optimism counter the recent Entain share price fall, down 32% since a 52-week high at the end of July? Let’s take a look.

The first thing I see raises a note of caution. Entain posted a loss after tax of £461m last year, and a 70.8p loss per share. Against that, underlying operating profit was put at £617m, with continuing adjusted earnings per share at 29.9p. And there were quite a few adjusting items.

CEO Stella David pointed out it was “a year of transformation for Entain“. And that can often mean wild swings in accounting measures. But it doesn’t help us analyse a company’s valuation.

Forward to the current year, and analysts expect another loss per share — though a much smaller one. With October’s Q3 update, the CEO said “Entain’s transformation continues at pace“, adding “we still have more to do“.

Jam tomorrow?

Bullish analyst targets are clearly geared towards a return to profit, expect in 2026. Earnings forecasts for that year suggest a price-to-earnings (P/E) ratio of about 13. That 92.5% price target hike, if it comes off by then, could push the P/E up as high as 25. I really don’t know if that could be justified.

A lot can happen between now and the end of 2026. Oh, like the UK Budget due on 26 November. Now that Chancellor Rachel Reeves has ruled out income tax rises, might gambling be a new taxation target? I could see it being very tempting. And regulation threat is ever present.

The Entain recovery does look impressive. And at the halfway stage this year, we saw a 5% rise in the interim dividend. There’s a forecast 2.8% yield on the cards — lower than the FTSE 100 average, but it could build up progressively.

Bottom line?

I’m getting mixed signals here. I do see attractive earnings growth prospects at Entain with its refocus bearing fruit. But until we see actual profits, the risk is still there. And it’s an industry that can be very cyclical.

I do think investors looking for FTSE100 growth could do well to consider Entain now. But I’ll base my decision on fundamentals, and not on analyst price targets — I don’t really understand why they’re so high.

The post Prediction: this overlooked FTSE 100 stock could be set to soar 90% appeared first on The Motley Fool UK.

Nvidia sits at the heart of the tech and AI revolution, designing the chips that power everything from data centres and autonomous cars to video games and virtual reality. It didn’t become the world’s biggest company, with a $4.4trn valuation, by accident.

S&P500 index star

Nvidia shares have risen another 30% in the past year, so the growth is inevitably slowing. Hardly surprising, given the price-to-earnings ratio now stands above 50.

Some say an AI bubble is forming, although I suspect we’ve still got further to go before that bursts. Analysts still expect Nvidia to climb another 22% over the next yar to around $223, but given recent successes, that’s a modest return.

I hold Nvidia in my Self-Invested Personal Pension (SIPP), but think investors should tread carefully today. There may be better opportunities closer to home on the FTSE 100, including this one.

Entain shares are tipped to win big

Brokers have a good feeling about international sports betting and gaming group Entain (LSE: ENT). Consensus forecasts suggest its shares are set to rise 43% over the next 12 months, to hit a target price of 1,171p. That’s twice as fast as the Nvidia projection.

Given Entain’s modest £5bn market cap, it has far more room for growth than at the trillion-dollar end of the market.

I spotted Entain’s potential in May 2024, after it had taken a bit of a beating. Botched acquisitions, a £585m bribery scandal in Turkey and disappointing early returns from its 50:50 US joint venture BetMGM had taken their toll. 

Starting from a low base, I felt it had plenty of room to recover. But I also warned it was risky, with constant regulatory threats, an investigation for possible money-laundering issues in Australia, and US tariffs.

Entain posted a £461m after-tax loss for 2024, despite £5bn in gaming revenues.

Yet its 2025 Q3 update on 15 October showed progress, with Entain on track to hit full-year 2025 guidance. Total net gaming revenues rose 6% year on year, with 7% growth at constant currency. 

CEO Stella David said the transformation “continues at pace”, with BetMGM expected to generate over £500m in annual cash by 2028.

High potential, high stakes

Yet the Entain share price has yet to take off, rising a modest 13% in the last 12 months. Despite that, the stock is expensive, with a price-to-earnings ratio of almost 27.

Many will be concerned about reports that the UK government may increase gambling taxes in its Budget on November 26, which might dent domestic profits. This is a diversified international operator, which should help offset the hit.

I’m still a little baffled about why brokers are so upbeat. I think Entain has serious potential and one bumper set of results could send it flying. The stakes are too high for me and I’m not really a big fan of betting anyway. More aggressive growth-focused investors may find this stock well worth considering, but I think others on the FTSE 100 have almost as much as potential, and with less volatility. As ever, stock picking is a personal thing.

The post Forecast: analysts say this forgotten FTSE 100 stock will smash Nvidia shares over the next year! appeared first on The Motley Fool UK.

In fact, Goldman Sachs raised its share price target on the stock to 1,100p in October. And that’s still below a consensus price of 1,175p. With the shares hovering around 790p at the time of writing, that would be a stunning 49% rise.

What happened?

We can see from the above chart that this looks like one of the FTSE 100’s more volatile share prices. And considering the business it’s in, I’m not surprised. Profiting from sports gambling depends so much on what’s happening each year. I’d expect the soccer World Cup to attract far more punters than the World Curling Championships, for example.

This is a business at the mercy of government regulation too. And it seems Chancellor Rachel Reeves might have the gambling industry in sight as a potential source of more tax revenue. In fact, she’s said companies in the sector “should pay their fair share of taxes and we will make sure that happens.”

That’s got to be one of the key risks right now. And I suspect such fears were partly behind the market’s unenthusiastic reaction to August’s expectations-busting interim results.

Even October’s trading update didn’t lift the share price. That’s even though CEO Stella David said: “With Entain becoming ever stronger and BetMGM growing profitably, we are increasingly confident in delivering consistent underlying growth and generating more than £0.5bn of annual cash from 2028.“

What next?

In some ways this might look like a money-for-nothing business. You take someone’s money on a bet, and usually don’t give them anything back. There’s clearly more to it than that though, and margins can sometimes be surprisingly thin.

For the 2024 full year, Entain posted a loss after tax of £461m. That’s even with net gaming revenue reaching £5,162m in the year. So what’s behind these ambitious broker price targets?

Analysts still see a bottom-line loss this year, but only a small one. They predict a bounce back to strongly-positive earnings in 2026, suggesting a price-to-earnings (P/E) ratio of 16 that year. It’s been dropping as analysts have upped their forecasts over the past few months. And a further mooted rise in 2027 would drop the P/E as low as 12.

The overall broker take on it? It’s one of the strongest Buy consensuses I can see for a FTSE 100 stock right now.

Winning odds?

I like these forecasts, and I like the way Entain is turning its business round so strongly. And coupled with a price target that might net us a 49% gain in a relatively short time, I think this is definitely worthy of consideration.

But, thinking on the damage a big tax hike could do, I’ll wait until after November’s Budget. And I’ll then revisit Entain as a possible long-term investment.

The post Prediction: analysts think this FTSE 100 share price is set to climb 49%! appeared first on The Motley Fool UK.

Business as usual

It’s common for tobacco duties to be raised in budgets, often above the rate of inflation. According to the Office for Budget Responsibility, these will generate revenue of £8.1bn (£280 per household) in the current financial year. Indeed, the industry appears to be something of a cash cow.

For example, British American Tobacco’s (or BAT as it’s known) worldwide gross revenue was £59.7bn in 2024. Of this, it paid £33.8bn (56.6%) by way of duties and taxes. Personally, I think it’s nailed-on that Chancellor Rachel Reeves will raise rates again in November.

However, I suspect it will have little impact on the share prices of BAT and Imperial Brands Group, its FTSE 100 peer. Annual increases have probably already been factored in to their stock market valuations.

But I think there’s more uncertainty about the gambling industry.

An easy target?

Entain (LSE:ENT), operates in 19 countries and owns numerous brands, including Ladbrokes and Coral. But the internet has helped transition its business model away from traditional high street bookies. In 2024, approximately 70% of the group’s net gaming revenue was derived online.

However, the group’s share price wobbled on 8 August — falling 5.8% — following comments made by Gordon Brown. The former Prime Minister said that the “undertaxed” gambling industry should face higher levies in the budget.

The Chancellor has refused to distance herself from the comments. She recently told ITV: “I do think there is a case for gambling firms paying more… they should pay their fair share of taxes and we will make sure that happens.”

Indeed, Entain reckons one of the biggest risks it faces is becoming a “target for special or super taxation”.

An existential threat?

And the consequences could be significant. The group’s boss says any increase in duties would have an impact, including job losses. She claims that the industry already pays its fair share.

The chairman of Betfred has warned that all of its 1,287 high street shops would have to close if taxes were raised by 50%, a figure floated by one think tank.

The Betting and Gaming Council cautions that a big tax increase would force gamblers to turn to the black market instead of using licensed bookmakers.

An odds-on certainty?

The global gaming market (which includes the betting industry) is worth £122bn and grew by an average of 15% a year from 2020-2024. And Entain is benefitting from this.

Revenue is growing strongly in most parts of the group. It’s expected to report EBITDA (earnings before interest, tax, depreciation and amortisation) of £1.1bn-£1.15bn in 2025. It was £1.089bn in 2024.

However, although it did well during the pandemic, its share price is now (20 October) approximately 60% lower than it was in October 2021. And the budget speculation isn’t helping.

I think it’s highly likely that gambling taxes will be raised next month. Of course, the impact on Entain’s share price will depend on by how much they go up. But given the uncertainty, I don’t want to invest.

The post Is Rachel Reeves about to send the share prices of these UK ‘sin stocks’ lower? appeared first on The Motley Fool UK.

H1 net gaming revenue (NGR), including revenue from the company’s 50% stake in BetMGM, grew 7% over the same period a year ago — and up 10% at constant currency. The report says the performance was “particularly pleasing as prior year Q2 comparators included [the] Euros tournament.”

Entain reckons BetMGM has a “clear path to $500m EBITDA and beyond.” That’s after guidance on 16 June indicated at least $100m EBITDA for the 2025 full year.

Bouncing back

An overhaul of gambling legislation in 2018 laid the grounds for a surge in US business. A law known as the PASPA act had effectively banned sports betting almost nationwide. But after it was declared unconstitutional, the way was open for individual states to set the rules. The formation of BetMGM, half owned by MGM Resorts International, was a prompt outcome.

In this half, BetMGM net revenue soared 35% at constant currency. And EBITDA reached $109m, already ahead of that earlier $100m full-year guidance.

The group recorded an overall loss after tax of £117m. It seems that’s down to charges related to one-offs, but it does cloud the overall picture a bit. Adjusted earnings per share rose 154% though, and the board raised the interim dividend 5% to 9.8p per share. For the full year, Entain now expects online NGR growth of 7%, with group EBITDA in the range of £1,100m to £1,150m.

As CEO Stella David said that “Entain’s transformation journey is well under way,” does the apparently sparkling outlook make it a no-brainer buy?

Still a gamble?

A number of issues make me pause. One is forecasts still showing a loss this year. I suspect they’ll be upgraded to some extent in the light of this latest update. But it makes it harder to judge the stock’s valuation.

A forecast price-to-earnings (P/E) ratio of 49 for 2026 also holds me back. Again though, I’ll watch for improvements in that as analysts mull over the first half. But as it stands, I’m not sure I see a lot of safety margin in that valuation.

I see non-valuation risks too. I mean, it’s the gambling business. And that makes it a prime target for lawmakers around the world. There’s really only one thing I’m confident of when it comes to gambling legislation and taxation — I expect both to be constantly changing, somewhere.

Against my caution, we do see a pretty strong Buy consensus among brokers — one of the strongest for FTSE 100 stocks. And the average share price target of 1,115p is 18% ahead of where it is as I write.

What to do?

So will I buy? It’s not one for me, but that’s mainly due to my preference for safer dividend stocks. But for growth stock investors who don’t mind the risk that comes with the strategy, I rate Entain as definitely worth considering — even after the past year’s share price rise.

The post Entain H1 results boost barely moves the share price — is it one to consider buying? appeared first on The Motley Fool UK.

Today’s jump was driven by US optimism. Entain raised its revenue forecast for BetMGM, its 50:50 joint venture with MGM Resorts. Net revenues are now expected to hit “at least $2.6bn” this year, up from earlier guidance of $2.4bn-$2.5bn. That follows a strong second quarter, with growth across both iGaming and online sports betting.

BetMGM is winning

The board now expects BetMGM to deliver EBITDA earnings of “at least $100m” in 2025, compared to previous hopes of simply breaking even.

Management said the division’s improved focus, ongoing momentum and revised strategy reinforces its path to $500m in EBITDA over the next few years. So it’s feeling confident.

I’m not the only one taking a fresh look. On 13 May, broker UBS raised its recommendation to Buy and lifted its target price from 820p to 920p. It pointed out that while Entain has been steadily improving operationally, the shares hadn’t responded.

UBS flagged a 9% free cash flow yield forecast for 2026 and said the group trades at a 20% discount to rivals, while still offering the highest earnings growth versus valuation.

I was excited at the time, writing: “Entain is leading the charge as UK equities recover from Donald Trump’s tariff turmoil, its shares jumping 35% in a month.” So why didn’t I dive in then?

Recovery play?

This is a controversial sector. It’s prone to regulatory shocks, and Entain’s been caught out before. In Australia, its local arm has been accused of handling £72m in bets from customers with alleged criminal links.

This isn’t a one-off. It 2023, it agreed a £585m settlement following a bribery probe at its former Turkish business.

There’s also a wider political risk. In March 2024, it issued a profit warning after tighter UK and Dutch gambling rules threatened to knock £40m off profits. One idea floated for Rachel Reeves’ autumn Budget is a higher tax on gambling. That won’t be the last of it, in the UK or elsewhere.

Despite the recent wobble, I worked out late this morning that the shares still traded at a lofty price-to-earnings (P/E) ratio of 25 . But with the shares up 27% in a year, maybe that was to be expected. However, the shares rose a bit more after I worked that out so the P/E is becoming even steeper.

This stock makes me nervous. The valuation looks high and the sector carries baggage. But others might consider buying, especially with momentum returning.

Analyst forecasts remain strong. The median 12-month price target from 16 analysts is 956p – a fair bit higher than today’s levels. Of 17 analysts covering the stock, 12 name it a Strong Buy and the rest say Hold. That’s a vote of confidence. None says Sell.

There’s a 2.2% trailing yield too. The 2024 dividend was hiked 4.5% to 18.6p, so there’s progression. For the right investor, this could still be a calculated punt worth researching. Not for me though.

The post The Entain share price jumps 14% on an upbeat report – time to consider buying? appeared first on The Motley Fool UK.