Tabcorp Holdings' FY20 net profit was in-line with Ord Minnett's forecast and its guidance. No dividend was declared.
The lottery division performed well but excluding that, the broker considers the company's wagering result calls into question the company's product and execution.
The broker feels Tabcorp is exposed to declining wagering and competitive pressures. Moreover, a reduced dividend yield points towards future concerns.
Ord Minnett reiterates its Lighten recommendation with the target price increasing to $3.10 from $2.60.
Sector: Consumer Services.
Target price is $3.10.Current Price is $3.67. Difference: ($0.57) - (brackets indicate current price is over target). If TAH meets the Ord Minnett target it will return approximately -18% (excluding dividends, fees and charges - negative figures indicate an expected loss).
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