Pleasure and leisure lifestyle company PLBY Group, Inc. (PLBY) has entered into a definitive agreement to acquire social platform Dream for $30 million, which is to be paid primarily in PLBY Group stock.
Following the news, shares of PLBY jumped 8.6% to close at $24.61 in extended trade on Monday. The deal is expected to close in the fourth quarter of 2021.
PLBY Group will use the technological platform of Dream to develop its new curated and creator-led site, CENTERFOLD.
CENTERFOLD is envisioned as a platform to empower creators with multiple formats of content creation and direct fan interaction, along with access to Playboy’s vast repertoire of content.
The CEO of PLBY Group, Ben Kohn, said, “We’re thrilled to announce our agreement to acquire the Dream platform. The platform we are acquiring and its development team will provide a strong technology underpinning to significantly accelerate CENTERFOLD’s launch, now expected in the fourth quarter of this year, and to quicken our ability to scale and drive meaningful value to our network of top creators.” (See PLBY Group stock chart on TipRanks)
Recently, Loop Capital Markets analyst Daniel Adam initiated coverage on the stock with a Buy rating. The analyst’s price target of $29 implies upside potential of 17.6% from current levels.
The analyst believes that Playboy is going through a transformational shift with a key focus on direct sales. The analyst believes that this strategic move is likely to hurt gross margins in the near term but is expected to be beneficial in the long term.
Consensus among analysts is a Strong Buy based on 3 unanimous Buys. The average PLBY Group price target of $41 implies upside potential of 66.3% from current levels. Shares have gained 144.9% over the past year.