BULLISH VIEW ON NETELLER

3 August 2007

Continued popularity of online gambling a harbinger of good (non-US) business?

The week started on a positive note for Neteller with a share price holding firm around the mid-70 pence range and a bullish assessment of the e-wallet's future in the British newspaper The Independent.

After summarising the e-wallet's recent challenges, writer Andrew Dewson opines that now that the [American] dust has settled, there are reasons for looking to the future with optimism.

"Online gaming is still phenomenally popular and growing fast, even with the US effectively shut down. There is a certainly a demand for the service Neteller provides and it is the market leader, with a good brand position," writes Dewson.

"What is more, it still has $75 million in cash, and while the drop in revenue from the US closure looks horrid, the company ought to at least break even this year. Shrewd investors have already cottoned on and the shares, now out of suspension, rallied to 79p from 73.75p at the end of last week."

The article suggests that there could be more to come from Neteller in the non-US markets, and predicts that even the American authorities might eventually see sense and the benefits of taxation and control rather than leaving the players at the mercy of "less salubrious" operators.

Pointing out the historical failure of prohibition measures on alcohol, Dewson speculates that if America reopens for business, the Neteller shares will again fly high, and the current situation offers investors a ground level opportunity.

STOP PRESS: Neteller shares have been trading in the high sixties to low seventies for much of this week - a far cry from the 176 share price prior to the American debacle.

Online Casino News courtesy of InfoPowa