Brightstar Lottery PLC (BRSL): A Bull Case Theory 

We came across a bullish thesis on Brightstar Lottery PLC on Value & Error’s Substack. In this article, we will summarize the bulls’ thesis on BRSL. Brightstar Lottery PLC’s share was trading at $14.36 as of February 2nd. BRSL’s trailing and forward P/E were 160.89 and 9.46 respectively according to Yahoo Finance.

Pixabay/ Public Domain

Brightstar Lottery PLC (NYSE: BRSL) is now a pure-play global lottery operator following the sale of its gaming and digital divisions to Apollo last year. The company runs seven of the world’s ten largest lotteries, benefiting from a recession-resistant, recurring, and highly profitable business model, with EBITDA margins approaching 50%. Despite a higher-than-expected license fee to renew the Italian national lottery raising investor concerns, shares are trading at an attractive EV/EBITDA of 4.5x, well below peers, highlighting a potential mispricing in the market.

Brightstar’s capital requirements are minimal, enabling substantial free cash flow to be returned to shareholders through a 6.2% dividend yield and a significant buyback program. Management projects generating over $7 billion in gross cash from 2025 to 2028, primarily allocated to organic growth initiatives, while $1.7 billion is expected to be returned to shareholders during the same period. The combination of high profitability, strong cash generation, and shareholder-friendly capital allocation creates a compelling investment case.

Even with near-term uncertainty from the Italian license renewal, the company’s core lottery operations are resilient, offering stable cash flows and attractive risk-adjusted returns. Brightstar’s undervaluation relative to peers, along with the visibility of recurring revenue streams and disciplined capital deployment, positions the stock for potential rerating as the market recognizes the company’s dominant position in the global lottery industry. Overall, Brightstar represents a unique opportunity for investors seeking high-margin, recession-proof operations with both dividend income and capital appreciation potential, supported by a clear path for shareholder returns and sustainable growth.

Previously, we covered a bullish thesis on DraftKings Inc. (DKNG) by LongTermValue Research in April 2025, highlighting its dominant U.S. sports betting position, expanding legalization, and projected 46% EPS growth in 2026. DKNG’s stock has depreciated by approximately 17.38% due to short-term volatility. Value & Error shares a similar view but emphasizes Brightstar Lottery PLC’s (BRSL) recession-resistant, high-margin lottery operations with strong recurring cash flows.

Brightstar Lottery PLC is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 32 hedge fund portfolios held BRSL at the end of the third quarter which was 34 in the previous quarter. While we acknowledge the risk and potential of BRSL as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than BRSL and that has 10,000% upside potential, check out our report about this cheapest AI stock.

READ NEXT: 30 Stocks That Should Double in 3 Years and 11 Hidden AI Stocks to Buy NOW

Disclosure: None.