“The Gaming Jackpot: Gambling Stocks are Hot and Things are Getting Even Better”
Anyone looking to invest in stocks would be well advised
to consider gambling stocks, as they are one of the hottest
stocks on the market globally. This is especially true
in Canada where gambling stocks are buzzing. For example,
a $10,000 investment in Canadian land-based gambling
stocks would have earned nearly $23,000, a 127% return.
The same investment in e-gaming stocks in January 2004
would have earned $35,529, a return of 255%.
According to a report on the gaming industry, things
are just going to improve too. Robert Winslow, an analyst
with Wellington West, concurs adding that he recommends
the following three gambling stocks trading on the TSX:
Great Canadian Gaming Corp (GCD/TSX) with a $60 target
price, Chartwell Technlogy Inc. with a $12 target price
(CWH/TSX), and FUN Technologies PLC (FUN/TSX) with a
$6 target price.
One reason for the rosy estimate of Great Canadian
Gaming Corporation, which runs casinos in British Columbia,
is their recent purchase of Georgian Downs, a casino
in Ontario, as well as their intention to expand their
racetrack business beyond British Columbia.
Winslow recommends Chartwell,
an Internet gaming software company, because it stands
to benefit nicely from England’s
recent passage of the Gambling Bill, which will improve
safety standards and security of Internet gambling sites.
This will then add legitimacy to the Internet gambling
industry as well as the companies involved in the industry.
Finally, FUN Technologies PLC is recommended because,
in spite of a poor 4 th quarter, FUN Technologies could
improve its fundamentals through well-planned acquisition
activity.
For Great Canadian Gaming Corporation, Winslow increased
his 2005 and 2006 estimates from $1.88 and $2.62 to $1.93
and $2.70. Winslow puts Chartwell Technology Inc. at
a strong buy and increased his target price for Chartwell
from $10.50 to $12.00. Fun Technologies could go as high
as $8.00 with the right acquisition activity, a 50% increase
above its current price.
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