With the help of Next Gen Stats (NGS), Genius Sports (NYSE: GENI) announced today that it has secured a deal with the Los Angeles Rams to deliver highlights throughout the team's home games at SoFi Stadium.
One of the biggest in-stadium screens in the US, SoFi's renowned Infinity Screen, will display the highlights.
"These highlights, powered by GeniusIQ, Genius Sports’ next generation data and artificial intelligence platform will include crucial NGS insights such as player locators and speeds, time for the quarterback to throw and a complete minimap,” according to a statement issued by the sports betting data provider.
The NFL's official data source is Genius.
Why Genius Cares About the Rams Deal
One may argue that the announcement of the Rams trade contributed to Genius's 3% rise in volume today, which was more than twice the daily average.
Investors generally don't care about betting companies' agreements with teams, but the Genius/Rams agreement may be an exception to that rule as it demonstrates that the technology company's attempts to expand beyond sports betting and use artificial intelligence (AI) are succeeding.
Genius and social media company X, formerly known as Twitter, signed an agreement in July that requires X to employ "Trend Genius" to better display ads. Trend Genius provides adverts that are relevant to the topics that X users are posting about after using AI to learn more about those topics. Genius will use technology at SoFi Stadium to help fans of all skill levels understand and enjoy complicated football topics.
“GeniusIQ applies powerful machine learning and AI to translate huge volumes of NGS data into a semantic understanding of football. It then powers real-time insights and brand activations, creating meaningful connections with fans when the on-field action is at its most compelling,” according to the statement.
Analysts Continue to Have Hope for Genius Sports
Genius is undoubtedly one of 2024's top-performing small-cap gaming stocks, up 26.21% so far this year, but some experts think the stock still has more upside potential. David Bain, an analyst at B. Riley, reaffirmed his "buy" recommendation for Genius in a recent note to clients.
“In our opinion, there is clear momentum in its betting division staging near-term potential earnings outperformance,” noted the analyst. “GENI framed a possibly even larger growth opportunity in its media division. Following our meeting, we believe GENI’s media earnings before interest, taxes, depreciation, and amortization (EBITDA) growth potential is both under-modeled and misunderstood, and media is positioned as a significant upside lever in forward periods.”
The company's FANHub product might be a "breakthrough" for its media segment, Bain continued. His $10 price estimate for the stock indicates a 27.3% increase from the closing price today.
