Original-Research: ZEAL Network SE (von NuWays AG): BUY

Original-Research: ZEAL Network SE - from NuWays AG



05.11.2026 / 09:00 CET/CEST
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Classification of NuWays AG to ZEAL Network SE



     Company Name:                ZEAL Network SE
     ISIN:                        DE000ZEAL241



     Reason for the research:     Update
     Recommendation:              BUY
     Target price:                EUR 85
     Target price on sight of:    12 months
     Last rating change:
     Analyst:                     Simon Keller



Our tip: above the guidance top end; chg.



We raise our estimates and expect ZEAL to beat its 2026 EBITDA guidance.
ZEAL generated c. EUR 25m of EBITDA before deal costs in Q3 without a peak
Eurojackpot. October's stronger jackpot backdrop gives ZEAL scope to repeat
that performance in Q4. Conservatively, we still model just c. EUR 20m.



Social lotteries helped ZEAL grow in a weaker market. ZEAL grew organic
sales by c. 9% yoy in Q3 despite a 3% decline in combined German Lotto and
Eurojackpot stakes. Eurojackpot had zero draws at the cap versus two in Q3
25. Lotteries segment sales grew 8% yoy, helped by higher ticket sales and
related fees from freiheit+ and by the new Dream Car Raffle. A richer
product mix lifted the lottery gross margin by 0.6pp to 18.5%. Games sales
rose 20% yoy, driven mainly by a 14% increase in monthly active users.
Notably, ARPU also rose c. 13% qoq to EUR 40.93, likely helped by ZEAL's
phased rollout of higher spin limits from July. Including EUR 10.5m from
SevenCanyon's first quarter of consolidation, group sales rose 26% yoy to EUR
77m.



The underlying EBITDA margin reached 32.1%. Excluding c. EUR 4.9m of deal
costs, Q3 EBITDA rose 32% yoy to c. EUR 25m. Personnel costs increased just
11% yoy against 26% sales growth, the clearest source of positive operating
leverage. Direct costs also fell as a share of sales, to 8.3% from 8.8%.
Even after deal costs, reported EBITDA rose 6% yoy to EUR 19.9m (8% ahead of
eNuW).



ZEAL needs EUR 16.3m in Q4 to reach the top end of the FY EBITDA guidance. We
see EUR 20.2m. That implies c. 37% EBITDA growth yoy in Q4 and FY26 EBITDA of
EUR 79.0m, EUR 4.0m above the guidance ceiling. Our Q4 estimate sits c. EUR 4.5m
below Q3 underlying EBITDA. Three October Eurojackpot draws at the EUR 120m
cap, versus none in Q4 25, should support customer reactivation.



The discount is getting harder to justify. ZEAL trades at just 8.3x FY27e
EV/EBITDA against a five-year average of c. 22x. Yet EBITDA growth looks set
to nearly double to c. 28% yoy in FY27, taking EBITDA to c. EUR 101m with the
margin back above 30%. Secular growth and a track record of turning EBITDA
into cash (five-year historical FCF/EBITDA of c. 92%) still support a
multiple around ZEAL's historical average, in our view. The PT implies 18x
2027e EV/EBITDA (eNuW).



Management seems to see value here too. The CEO and CFO bought c. EUR 87k of
shares in late September at average prices of EUR 42.14 and EUR 42.80,
respectively. This compares to a share price of c. EUR 40 today.



ZEAL's growth is becoming less dependent on the jackpot calendar. Its own
lotteries and Games give players reasons to return between big draws, and
SevenCanyon gives ZEAL a platform for international expansion.



Action: the strong Q3 operating performance points to the group's potential
and supports a 5.6% average increase in FY26-28e EBITDA estimates.



BUY, PT raised to EUR 85 (old: EUR 83), based on DCF.



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Contact for questions:
NuWays AG - Equity Research
Web: www.nuways-ag.com
Email: research@nuways-ag.com
LinkedIn: https://www.linkedin.com/company/nuwaysag
Adresse: Mittelweg 16-17, 20148 Hamburg, Germany
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Diese Meldung ist keine Anlageberatung oder Aufforderung zum Abschluss
bestimmter Börsengeschäfte.
Offenlegung möglicher Interessenkonflikte nach § 85 WpHG beim oben
analysierten Unternehmen befindet sich in der vollständigen Analyse.
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2428834 05.11.2026 CET/CEST