Aristocrat Leisure Limited
Expanding through Acquisition & Partnerships: Aristocrat Leisure Limited (ASX: ALL) has recently given 2018 G2E investor presentation, in which the company has highlighted that the acquisition of Plarium and Big Fish had significantly increased the scale of the company’s Digital business. Aristocrat Leisure’s Digital business for the 1H 2018 had reported a 230.6% growth in revenue to US$428.5 million due to the strong performance of its Cashman Casino game and the acquisitions of Plarium and Big Fish. The segment during 1H 2018 had 8.3 million daily active users, up from 1.4 million a year earlier. The company continues to invest in premium video hardware and the expanding portfolio of Gaming operations into low, mid and high denomination segments. Lightning Link & Dragon Link are dominating the top performing lease games list and the company plans to release Dollar Storm in 2019. For Outright sale, ALL was on track to go live in Washington market in October 2018 and has strategic partnership with Tulalip tribe, Aristocrat sponsor. The company was also on track to launch in Manitoba market by mid-October 2018. On the other hand, Dr. Ian Blackburne will retire as the Chairman of the company on 21 February 2019 and will be succeeded by current Non-Executive Director, Mr. Neil Chatfield. Meanwhile, ALL stock has fallen 20.38% in three months as on October 29, 2018 and is trading at a high P/E. The stock is trading at the price of level $26.71, and has support at $26.12 and resistance at $29.60. Based on the foregoing, we have a wait and watch view on the stock at the current price of $ 26.71.
Webjet Limited
Decent FY 19 Outlook: Webjet Limited (ASX: WEB) for FY 18 has reported 54% rise in Total Transaction Value to $3 billion, 54% rise in revenue to $291 million, 71% increase in EBITDA to $87.4 million and 30% growth in Net profit after tax (NPAT) to $43.2 million. Moreover, for FY 19, WEB has reiterated the bookings growth targets for FY19-FY20 for both the B2C and B2B businesses, and expects bookings growth rates of more than 3 times the underlying market for B2C and more than 5 times the underlying market for B2B. On the other hand, Australian Bureau of Statistics has released decent numbers for inbound and outbound tourism for the month of August. Meanwhile, WEB stock has fallen 4.91% in three months as on October 29, 2018 and is trading at a high P/E of about 34.98. The stock is trading at the price of level $13.01, and has support at $11.42 and resistance at $17.58. We believe WEB is a play to be watched while it trades at the current price of $ 13.01, up 3.3% on October 30, 2018.
Elixinol Global Limited
Strong Revenue Growth & Funds Raised During the Third Quarter of FY 18: Elixinol Global Limited’s (ASX: EXL) stock rose 5.99% on October 30, 2018 after the company in the business update for the third quarter of FY 18 delivered 159% growth in revenue $10.4m on prior corresponding period (PCP) and 27% growth compared to the second quarter of FY18. The company incurred the capex of $1.5m during the quarter. At the end of the September quarter, EXL had $10.7m cash at bank and $0.25m in debt. During the third quarter, EXL raised $40m through the placement of shares to accelerate international growth. The funds raised will be used to support the growth of EXL USA’s hemp-derived CBD business and further expand its production capacity. The funds will also be used to expand EXL’s sales and marketing activities in Europe, and for general working capital, that includes the funding of strategic investments. Moreover, EXL has planned to increase its ownership in Elixinol Japan to 50.5% for $2.2m. Additionally, during the third quarter, EXL commenced trading on the OTCQX exchange. Therefore, EXL stock has risen 11.62% in three months as on October 29, 2018. The stock is trading at the price of level $1.68, and has support at $1.36 and resistance at $2.15. Based on the foregoing, we give a “Speculative Buy” recommendation on the stock at the current price of $ 1.68 in view of the latest result and boost in the cannabis space.
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Third Quarter 2018 Financial Performance (Source: Company Reports)
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