please read carefully and compare with other brokers opinions, DYOR...thx ....
Tatts Group Ltd Fine Tuning Estimates Wagering Pools are declining and Victorian Gaming is also trending negatively. Lotteries are the only positive segment we see, but the final few months of 2H10e will run up against very tough comps from the previous corresponding period (pcp). We've revised earnings down very slightly to reflect trends evident. FY10e core EPS down 2.5%, FY11e & FY12e down ~4%. Target price lowered to $2.40, Hold, Medium Risk recommendation retained. We are now 8% below average market forecasts. The market expects 2H to be flat over pcp. While we estimate the acquisition of NSW will add to $4m to pre-tax 2H earnings, the overwhelming market trends will outweigh the contribution in our view. We suspect further downward revisions in the lead-in to FY10 will take the average down. FY11 earnings should rebound We now forecast 8% growth in FY11, with the addition of a full year of NSW Lotteries. Wagering may benefit to a degree from 2010 Soccer World Cup, given TTS now operates its own NT-based fixed odds sportsbook. We note that total Northern Territory Corporate bookmaker turnover grew by 44% in FY07, when the last World Cup was held, and within this, sports betting rose 55%. Large global events are a boost to brands for licensed bookmakers as well.
