Tag: ASX:ALL

Aristocrat Leisure is forecast to grow earnings in FY18 at 18%, placing the stock on a forward yield of 2% and price to earnings ratio (PE) of 23x. Whilst, the stock is expensive, the valuation is supported by a “top tier” earnings growth profile.

Our Algo Engine triggered a buy signal in ALL on 28/7/17 at $19.83, the strong buying interest in yesterday’s session, (ALL went ex div $0.20), provides confidence that the upside momentum will continue.

ALL delivered $543m, (37% increase), in underlying profit for FY17.

A good result was offset by a negative response to their announced acquisition of Big Fish Games. The acquisition of Big Fish is the second deal this year where Aristocrat is expanding into social gaming.

FY18 is forecast to deliver a further 20% growth with net profit of $650m, EPS $1.05, DPS $0.42 placing the stock on a forward yield of 1.9%.

We hold ALL in our ASX 50 model portfolio, following the Algo Engine buy signal triggered in July at $20.25.

Aristocrat Leisure released 1H17 results with revenue and net profit beating analysts’ bullish expectations. Full year guidance was reiterated with profit growth likely to be + 20-30%.

North America and Digital underpin a strong earnings outlook and the company’s strong balance sheet, will likely see excess capital returned to shareholders and/or new acquisitions announced.

The company declared a dividend of $0.14 for the half-year, which was up from $0.10 in 1H16.

FY18 revenue is likely to increase 10%+ to $2.7b, EBIT $900m on EPS of $0.90, DPS of $0.36, placing the stock on a forward yield of 1.8%.

Our Algo Engine last generated a buy signal in October 2016 at $15.00

Aristocrat Leisure posted strong FY 2016 results with top-line net profits surging more than 67% to $398 million compared to a year ago. This result was well in front of the consensus forecast of $376 million and reflects strong growth in both the US and Australian markets.

However, as impressive as the headline numbers for the 2015 to 2016 time frame appear, some of the internal figures suggest the growth in share the price may not repeat in 2017. With dividend growth expected to increase from 20.5 cents per share in 2016, to 24.6 cents per share in 2017, the total dividend yield is expected at 1.7%.

With EBIT expected to rise from $605 million to $674 million, this small increase in expected dividends is making Aristocrat look expensive at current levels.