Hello, dearest Gumshoe friends — today we’re trying something a little different.
We’ve gotten a lot of requests about the latest pitch from Roger Conrad for his Big Yield Hunting newsletter, teasing that they’re “betting on this 10.6% Big Yield!” … and we’ve got an answer for you, thanks to the speedy and sagacious Thinkolator, but we’ve run out of time to cogitate on the actual stock for you (why? Well, it’s a long story involving James Taylor, the Independence Day Holiday, and a dog who decided that eating half his weight in food would be a good idea at 3am).
We’ll run through the clues, tell you the answer, then you analyze it for your fellow investors — and the best analysis wins a prize (more info at the end).
So here’s the pitch:
“‘Let me entertain you!’
“That’s the rallying cry of this sophisticated $1.5 billion gambling and entertainment company. It’s a world leader in wagering, gaming and Keno.
“More than 300,000 folks place bets on sporting and other events in 2,800 of this company’s outlets. And it also operates 8,500 electronic gaming machines—the highly popular way to gamble nowadays—that are found in licensed hotels and clubs.
“Plus, they have just inked exclusive monopoly licenses to run Keno for another 10 years! Keno is a fun, easy-to-play numbers game that offers the chance to win prizes. You could hit it big with a million-dollar jackpot… or easily double your money. With 3,300 Keno outlets, revenue is in the hundreds of millions.
“Everything about this company screams fun, fun, fun. And even if you don’t like to gamble, you’re going to love locking in a big, double-digit dividend yield for just peanuts.”
So that’s the basic idea — Roger Conrad and David Dittman are recommending a gambling stock that pays a big dividend. A few more clues?
“Now is the best time to pick up this company—it’s dirt cheap, too! Why?
“In 2007 the stock was trading at almost 3 times its current price. But we all know what happened then—the global economy tanked and solid companies like this went on a downslide.
“It didn’t help that the government in 2008 changed the way it awarded gaming licenses. The company sure took a hit on that one. The stock took a big tumble and continued sliding down until October 2011. It was torture being an investor in the company then. But not now.
“That’s because through the steep decline, the company kept paying out a dividend. And now it’s yielding a whopping 10.6%….
“Recent reports show revenue from its gaming and entertainment endeavors continues to grow. Underlying earnings are healthy, even in these ongoing tough times. Plus, it has a brand-new CEO ready to move the company forward by favorably refinancing maturing debt and securing long-term gambling licenses.”
So we’ll keep it short and sweet today — what Roger doesn’t mention is that this company is Australian (Australians are the world’s leading per-capita gamblers), which does help a bit in sorting out the answer.
But today’s teaser pick, according to the Mighty, Mighty Thinkolator is … Tabcorp Holdings (TAH in Australia, TABCF on the pink sheets). And you can bet that they first wrote about it in mid-May, because that’s when trading volume spiked briefly for the pink sheets shares. It does pay a strong dividend, it is a match for the other clues, and beyond that I must leave you to do the “do it yourself” analysis.
There’s a reward, though: Whoever does the best job of analyzing this company for us in a comment below, in 300 words or less, will get a prize — I’ll send you a 2010 or 2011 proof silver American Eagle coin, worth something like $50-75. So get your analyzing shoes on, get running, and let us know what you think — no other criteria for how you analyze, just tell us what you think of the company’s prospects and why, and I’ll read ’em and decide which comment I like the most. Enjoy!
Personal Capital is an advertiser with Stock Gumshoe, but Travis also uses it every day for his personal accounts and finds it invaluable. Here's what he said: "They offer a great (and genuinely FREE) 'second opinion' for your financial plan, but what I love most is their automated financial dashboard -- it will look at all your assets and debts, tally up your asset allocation, project where you'll be at retirement, and suggest ways to manage risk or improve returns. It's free, I think their free tools are great, and I think it's worth checking out -- you can do so here.