In today’s daily we have covered stock research on Aristocrat Leisure. To view 4 Growth + Dividend Stocks to buy click here

S&P 500 was up by 3.52 points or 0.19% to 1884.66 on Monday. U.S. stocks ended slightly higher as data showed strength in the services sector and Apple shares rose above $600 for the first time since 2012. Limiting the day's gains, however, were concerns over an escalation of tensions between Ukraine and pro-Russia separatists. 

The Institute for Supply Management said its services sector index rose in April, hitting the fastest pace in eight months and topping expectations. It was the latest report to offer some upbeat news on the economy, which was hit by an unusually harsh winter. Pfizer Inc shares fell 2.6 percent to $29.96 after gaining last week. The biggest U.S. drugmaker reported revenues well below analysts' expectations.


S&P 500 Daily Chart   (Source – Thomson Reuters)
 
S&P ASX 200 was up by 4.1 points or 0.08% on Monday and closed at 5462.2 points. On the back of the bid from Baosteel and rail haulage group Aurizon, Aquila Resources went up more than 36%. The bid would grant them control of $7.4 billion West Pilbara Iron Ore Project led by Aquila in a joint venture.

Bendigo and Adelaide Bankhas taken over Victoria’s Rural finance for $1.78 billion. Rural finance has 3,300 customers across farm lending. There is speculation that Bain Capital might be looking to acquire Boost Juice. Recall Holdings announced that National Australia Bank Limited and its associated entities holds ordinary shares representing 5.768 pct of voting power.


S&P ASX 200 Daily Chart (Source – Thomson Reuters)

The top gainers on ASX 200 were:- 



Stock of the Day – Aristocrat Leisure (ALL)
 
Aristocrat is among the largest global electronic gaming manufacturers and distributors of gaming software. It generates global revenues from electronic gaming machine manufacture, distribution and software, with revenue and profit sharing agreements operating in the U.S. The company holds large market share in Australia, Macau and Singapore, but changing regulations, volatile demand and unstable consumer spending has resulted in volatile earnings.

Management has indicated that earnings will be weighted to the second half of the fiscal year given the timing of the new game releases and higher development costs that will be expensed in the first half. The significant impact that game release can have on earnings and the difficulty in predicting release dates gives the stock a high uncertainty rating.


Source - ALL

Aristocrat’s strong domestic share, extensive game library and regulatory licenses support makes it a stable company in the gaming environment. We believe that product improvements and liberation of the gaming sector in emerging markets will drive medium term growth for Aristocrat. The most immediate market opportunities include Macau and the Philippines.


ALL Daily Chart  (Source - Thomson Reuters)
 
Growth in smartphone usage, online gaming and social media provide additional platform to distribute Aristocrat’s large library of titles. Gaming content is now accessible on Aristocrat’s Facebook application with initial evidence suggesting spend is trending higher. Despite improved operating performance, we continue to view Aristocrat as overvalued and believe growth opportunities are already priced in. We believe the stock is overvalued at its current price and would review the stock at a later date.

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