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CWNHB - Crown Resorts News Story

A$95.1 -0.3  -0.3%

Last Trade - 5:06am

Sector
Consumer Cyclicals
Size
Large Cap
Market Cap £3.33bn
Enterprise Value £3.45bn
Revenue £1.64bn
Position in Universe 83rd / 1836

BUZZ-Chips no longer down: Citi bets on strong recovery for Aussie casinos post reopening

Mon 6th July, 2020 8:47pm
** Research broker Citi says near-term outlook for domestic
gross gaming revenue (GGR) from Australian casinos is robust,
driven by limited restrictions within casinos upon reopening,
pent-up demand and government stimulus
    ** Citi expects FY21 domestic GGR and EBITDA to be down a
moderate ~12% and ~20% respectively across the industry vs FY19
    ** Upgrades Star Entertainment Group  SGR.AX  to 'buy' from
'neutral' and downgrades Crown Resorts  CWN.AX  to 'neutral'
from 'buy' on risk of further delays in Melbourne's reopening
    ** Says while CWN's balance sheet, assets, and free cash
flow profile remain appealing, it sees better share price upside
for SGR in near term given the earlier reopening path and
relative valuation
    ** "Feedback from NZ and NSW indicates revenue will bounce
back initially... We are more cautious however around how far
this recovery extends, particularly given income pressures and
the opening of Crown Sydney amidst border closures"- Citi
    ** As a result, broker increases SGR and CWN FY21 EBITDA
estimates by ~13% and ~37% respectively; however is ~11% and ~9%
below consensus on the two on FY22 EBITDA forecasts
    ** SGR shares down ~36% this year, while CWN stock has
declined ~19%

 (Reporting by Shruti Sonal in Bengaluru)
 ((Shruti.Sonal@thomsonreuters.com; Twitter: @shrutisonal26))
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