We recommend accumulating shares in Crown Resorts as the price finds support near $13.50.
FY19 EPS growth will be around 8%, placing the stock on a forward yield of 4.3%.
Crown goes ex-dividend for $0.30 on the 20th March 2019.
Selling December $14.25 call options will add a further $0.21 of income per share.
Crown Resorts
Crown is likely to find buying support within the $13 – $13.50 price range.
As such, we recommend investors accumulate the stock and look to sell a covered call option to enhance the yield.
Crown Resorts
We currently hold Crown Resorts in our ASX top 100 model portfolio, following a Algo Engine buy signal back in February at $12.50.
The stock has recently retraced from the $14.59 high made on the 10th August.
We now feel the sub-$13.50 level provides an opportunity to accumulate Crown shares at a fair valuation.
NOTE: Star Entertainment is also back in the buy zone between $5.13 – $5.30
Crown
Should Crown retrace back to $13.50 – $13.75, we consider the entry range as good medium term value.
Crown next goes ex-div on 20th March 2019, so adding a covered call into December will help drive additional cash flow, whilst waiting for the next round of dividends.
Crown
Crown was a “high conviction” call coming into yesterday’s FY18 earnings result. EBITDA increased by 6% and NPAT was up 13% to $378m.
VIP gaming revenue was up almost 70% on the same time last year. At the peak in 2015, Crown VIP was turning over $52 billion and it now stands at $44 billion.
Although, we see scope for cost control and share buybacks as net positives for the share price, we also feel the 23x FY19 multiple is starting look too expensive.
Crown goes ex div $0.30 on the 20th September and the stock now trades on a forward yield of 4.3%.
Note: Crown’s Sydney project is due for completion in 2021 and total project cost is estimated to be $2.2 billion.
Crown Resorts
We followed an ALGO buy signal for CWN back in February at $12.60.
However, over the last few months, the stock has traded in a relatively narrow range between $13.80 and $13.25.
With the company reporting full year earnings next Thursday, we see the potential for the stock price to trade up through the top end of the range.
We expect CWN to beat the consensus NPAT forecast of $370 million as operations in both Victoria and Sydney could print higher numbers.
CWN goes ex-dividend for 30 cents on September 21st and we see the next upside target neat $14.25.
Crown Resorts
We continue to prefer the long side of Crown Resorts and view the stock as a suitable “buy-write” strategy for client portfolios.
$14.01 (Euro) Dec call options generate an additional $0.50 of income per share.
Crown Goes ex-dividend $0.30 on the 21st September.
Crown Resorts
We’ve been holding Crown Resorts following the recent Algo buy signal at $12.41, back in February.
Crown has a renewed focus on cost control and the supportive back drop of a lower Australian dollar, as well as, increased inbound tourism should lead to the August earnings result surprising on the upside.
Crown goes ex-div $0.30 on the 21st September.
Our Algo Engine triggered a recent buy signal in Crown Resorts and, with the stock price finding support at $12.50, we recommend investors add long exposure.
Our upside price target is $14.00.
Crown goes ex-div $0.30 on the 21st September.
Buy Crown Resorts
Our Algo Engine triggered a recent buy signal in Crown following the pattern of “high low” formations. We see support at $12.50 and recommend buying the stock and selling $14 call options to enhance the portfolio income
Crown goes ex-dividend on September 21st and will pay 30 cents per share, fully-franked.
Crown
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