ALL 0.70% $36.64 aristocrat leisure limited

compare to igt

  1. 3,567 Posts.
    IGT in the states is trading on a PE of 25 and make around $518m last year alone.

    Compare this to ALL's 1 year forward PE of 8-9 and the potential is there for all to see. ALL's product is very well received in the US with the hardware the best in the business. They have focused on the wrong games and hence the lower than expected unit sales. This will be fixed and reported in the review to be released later this week.

    ALL is spending $65m per annum on R&D business better games such as "Cashman" and well performing games such as "King penguin" (better than average turnover). Their servicing of pokies has been well taken up increasing from around 20% of customers to 90%+ last year. This should provide a stable source of revenue from servicing and game sales.

    So while we see this $65m as less profit now it should allow ALL to more easily expand into the US market once thgey focus on the games that are in demand i.e. the stepper product.

    IGT also has around $800m in cash and short term securities, a takeover is now out of the question but regulators in the US might have something to say.

    So basically who do you believe?? PPT who have bought over 10% of the stock looking for the business to show it's true colours or the scaremongers (press and analysts) who say the sky is falling in??

    I think I'll back PPT on this one, my money is firmly into ALL.
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