GigaMedia (Online Casino / Poker) Shares Hit 7-Year High

2007-10-24
Jonny Vincent

Shares in online casino and poker company GigaMedia Ltd hit a 7-year high last week, continuing a stellar rise over the last two months after Bear Stearns analyst James Rhee gave the stock an "Outperform" rating.

The stock (NASDAQ: GIGM) had slumped to $8.66 in August but launched a strong recovery after GigaMedia released better-than-expected financial results, showing the company had successfully transformed itself from a struggling broadband company to an online gambling and entertainment empire with a strong European presence with reach into the blossoming Asian market.

The share price shot up to the $23 range after Rhee predicted that GigaMedia could benefit from regulatory

easing in Europe as the European Commission aggressively pursues the EU free-trade policy. In a note to clients last week, Rhee pointed out GigaMedia revenue is increasing "at a healthy clip" and the company has a good investment history.

GigaMedia is also attractive as a long-term investment stock due to the company's Asian presence. The Asian online gambling market is considered the last frontier for online gambling companies, and potentially the most valuable of all. GigaMedia is aware of this and has secured a license to offer and operate the multiplayer online role-playing game Holic in China, Taiwan, Hong Kong and Macau.

GigaMedia owns a popular range of online casinos, including: