stagnant share price..., page-4

roastman and others,
today i have requested info from my brokers Morgan Stanley re TTS and received their recent opinion as below.
good reading. patience seems to be the issue.
also, please DYOR.

Tatts Group Ltd (TTS.AX)
AGM 2009: FY10 will see slower (but positive) growth
Lotteries strong, Wagering seeing margin pressure, Pokies tough X TTS faces a
tougher FY10E, as consumers moderate their spending in response to tougher
economic conditions and aren't supported by stimulus payments. TTS won't
repeat FY09 8.3% eps growth, but "won't be a lot different". Our forecasts
assume 7.9% eps growth, may be marginally too high.
What was new at AGM X TTS flagged cost pressures in wagering as punters
migrate to fixed odds and as TTS establishes its NT sportsbook by end CY09.
Turnover is up 5%, revenue up 3%, but EBITDA expected to be flat.
Expect tough comps in Vic Pokies without FY09 stimulus payments X TTS reiterated
comments made at FY09, that even with additional machines, TTS
expects weaker revenue growth without the benefit of the FY09 stimulus
payments in 1H and 2H. 1H10 EBITDA will fall over PCP, given investments in
new games and new restrictions on maximum bet per spin.
Lotteries are still lucky (for TTS) X Lotteries revenue is up 8% in 1H10 to date,
with margins improving as well, due to Powerball jackpots in July 2009. TTS
still warn FY10 could be lower than FY09, give difficult OZ Lotto comps.
Other Divisions X Intend to sell South African route ops, no guidance on value,
but with FY09 EBITDA at $5.9m, proceeds expected to be modest. Talarius UK
sales up 12% yoy, benefiting from 2 acquisitions, but guide that 1H10E profits
will be weaker on pcp. Maxgaming and Bytecraft (11% of EBIT) EBITDA up by
5% in 1H10 to date.
Acquisitions & organic growth focus X TTS continues to pursue a number of
potential growth avenues including a bid for NSW Lotteries, expansion of
Maxgaming into Vic and other networked business opportunities.

Buy/Medium Risk 1M
Price (30 Oct 09) A$2.48
Target price A$3.00
Expected share price return 21.0%
Expected dividend yield 9.3%
Expected total return 30.2%
Market Cap A$3,164M
US$2,840M