Tabcorp Holdings has received a revised proposal for the Wagering & Media business from Entain plc, which values the segment at an enterprise value of $3.5bn versus around $3bn previously. As part of the previously-announced strategic review, the board will assess.
The valuation appears reasonable to the broker. It’s believed the market will now focus attention on the potential standalone value of the high quality Lotteries & Keno business.
The analyst thinks the market will continue to value the company from a break-up perspective. Consequently the valuation model is changed to a sum-of-the-parts methodology. The target rises to $5.11 from $4.04 and the rating of Hold is unchanged.
Sector: Consumer Services.
Target price is $5.11.Current Price is $5.00. Difference: $0.11 – (brackets indicate current price is over target). If TAH meets the Morgans target it will return approximately 2% (excluding dividends, fees and charges – negative figures indicate an expected loss).
