Tabcorp’s result missed the broker at the headline but the detail within the numbers was positive. The company’s high multiple monopoly in lotteries grew by 20%, showing “unprecedented” online penetration. Wagering fell -4% but this reflected a hyper-competitive period, the broker suggests, in which yields fell across the industry.
The corporate bookmakers report in March, the broker notes, which will provide more clarity on market share and industry profitability. Meanwhile the wagering relaunch of UBET continues and synergy guidance has been upgraded. Buy retained, target falls to $5.20 from $5.30.
Sector: Consumer Services.
Target price is $5.20.Current Price is $4.58. Difference: $0.62 – (brackets indicate current price is over target). If TAH meets the UBS target it will return approximately 12% (excluding dividends, fees and charges – negative figures indicate an expected loss).