DAVY VIEW

There is little by way of surprise in Paddy Power Betfair’s (PPB) 2018 results. EBITDA is modestly ahead of expectations, with its H2/Q4 performance across key businesses broadly equivalent to prior periods. 2019 is an important year for the company. If it can make progress across key areas, it will produce a compelling investment thesis. Encouragingly, it has leading positions in key markets, with a balance capable of funding additional growth opportunities. We are unlikely to make material changes to our forecasts. However, we are mindful that consensus does not yet fully reflect the required investment in the US.