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

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 67

Target price on sight of: 12 months

Last rating change:

Analyst: Simon Keller

The odds remain compelling

Following a multiple compression over the last years (2026e EV/EBITDA c. 37%

below 5-year historic median), ZEAL's structural growth profile and earnings

trajectory remain intact, creating an attractive entry point into the

ongoing online penetration story.

The 2026 regulatory agenda looks pro incumbent and pro enforcement, which

should be supportive for ZEAL. First, the evidence-based review of current

regulation (GlüStV) by the gambling regulator (GGL) is likely to result in

minor adjustments at most (such as technical clarifications), as the joint

body of Germany's 16 state lottery operators (DLTB) continues to portray the

current framework as well calibrated.

Second, and the more important, regulatory cross read is positive

enforcement momentum. In February, Baden-Württemberg approved moving forward

with an amendment to the GlüStV explicitly aimed at strengthening

enforcement and supervision. The focus is on tougher action against illegal

online offers. Every incremental enforcement step, including IP blocking as

a policy tool, increases the odds of demand shifting into regulated

channels. As Germany's leading online lottery broker with c. 44% market

share, ZEAL looks set to be the primary beneficiary.

Beyond the regulatory tailwind, the core mid-term driver remains the shift

of lottery demand into online channels. Online penetration in Germany can

plausibly move beyond 50% mid-term (eNuW), up from 31% today, as the digital

customer journey is simpler than offline. As the clear online leader, ZEAL

should capture a disproportionate share of this migration and is seen to

reach 50% market share mid-term. While ZEAL still invests c. 30% of sales

into marketing, margins have meaningful upside once the market matures and

growth spending normalises. With c. 60% of billings subscription driven, the

revenue base is mostly recurring, supporting a step up in profitability when

growth investments can be lowered.

At the same time, ZEAL's Dream House Raffle is emerging as a meaningful

proprietary growth driver with structurally attractive economics and visible

scaling potential. With only 4 raffles in 2025, ZEAL is expected to generate

sales of EUR 17m (8% of group, eNuW). We see a credible path to scaling the

format up to EUR 50m by 2030 (c. 20% of current group revenues, eNuW).

Importantly, the format should carry a structurally higher margin than the

core lottery brokerage business, driven by a significantly higher take rate

on ticket billings (c. 46% vs. c. 17% for group).

ZEAL's execution has been consistently strong, with management converting

customer growth into margin expansion and cash generation, providing

confidence into future delivery. The company remains net cash positive,

providing downside protection and ample flexibility for continued capital

returns to shareholders.

BUY, PT EUR 67, based on DCF. - analyst change -

You can download the research here:

https://eqs-cockpit.com/c/fncls.ssp?u=3126102a87a17dd66a1cea67e70efa2c

For additional information visit our website:

https://www.nuways-ag.com/research-feed

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

Diese Meldung ist keine Anlageberatung oder Aufforderung zum Abschluss

bestimmter Börsengeschäfte.

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2279610 23.02.2026 CET/CEST

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