Ord Minnett notes if reports of a potential acquisition of Tabcorp Holdings' underperforming wagering and media division come to fruition, Americans may be spending $6.6bn pa on Australian racing very soon.
The broker suspects any would-be buyers will target the Sky Racing media assets and that the bidder is likely to capitalise on the bearish wagering outlook to extract the value of the media business.
Sky Racing and media assets are valued by Ord Minnett at about $900m, with potential upside using US-media rights valuations.
Ord Minnett retains its Lighten recommendation with a target price of $3.10.
Sector: Consumer Services.
Target price is $3.10.Current Price is $4.57. Difference: ($1.47) - (brackets indicate current price is over target). If TAH meets the Ord Minnett target it will return approximately -47% (excluding dividends, fees and charges - negative figures indicate an expected loss).
© 2021 Acquisdata Pty Ltd., source FN Arena