Charles Jillings, CEO of Utilico, energized by strong economic momentum across Latin America. Watch the video here.
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You raise some fair points but having bought back in on the dip I am holding. The FT forecasts from 16 analysts suggests from 265p to 380p with a median at 325p. Sad to say people continue to gamble during recessions even when money is tight. They like a flutter and frankly so do I hence a small stake in WMH. Still think a bid possible from 888 as WMH has a US presence.
Things aren't looking good here. Speculative optimism towards the US market has increased the SP here. Just because the Supreme Court has overturned the 1992 US legislation on gambling, classing it as "unvonsitiutional", it has instead left it to individual states to create their own rules - Yes, sport is big in America, but US states will be cautious towards the parameters they enforce due to the vast economic effect gambling *could* (most likley will) have on state economies, especially in the more economically deprived areas... We have seen first hand the corrosive effect gambling has had on the UK, more so for the socially-economic deprived people... as I speak, sat in a Weatherspoons Pub, in Abingdon, Oxfordshire a Stan James opposite is closed with a 'Let available' sign above it, additionally, to this, next door is a William Hill; one of the helpful employees has informed me that they aren't seeing as many customers as usual, and not as many people are playing the FOBTs - more so, customers are having smaller £1/£2 accumulators on the football or one or two £10 bets on the horses. The gambling commission have shower statistics that betting is by far the most popular way of gambling (Gross gambling yield by sector - against arcades, bingo, betting and casino). Additionally, to this, £2 FOBTs threshold will significantly reduce revenues, which will adversely hit profits. WMH have estimated that total net gaming revenues could fall by between 35%-42%. Which would result in around 900 shops, or 38% of the total estate resulting in loss making and being forced to close... Annual adjusted operating profit is forecast to fall between £70M - £100M. This decision regarding the £2 FOBTs appears to be politically motivated rather than practical and Public Health England are due to conduct a review into the public health effects of gambling. Furthermore, Analysts at 'Goodbody' say thay WMH are the most exposed to changes, primarily due to the fact that during the first four months of this financial year, 70% of WMH total gaming machine net revenue came from stakes made above the £2 threshold... If punters can not spin £100 on the wheel, will they a) play more, b) branch out into a different form of betting, or c) stop all together? Despite all of this, WMH is still aiming to pay out around half of its underlying earnings in dividends, as a desperate ploy to retain shareholders. Don't be deceived by this as if profits start to drastically fall that dividend will soon be slashed, alongside a good 40% of the SP. A good shorting opportunity in my opinion. GLA, stay safe, speak soon.