Forum Archive Index - February 2001

["G Stolwyk" <stolwyk@wave.co.nz>]

 

 

Philip,

 

SKC < www.skycity.co.nz > is one of my picks in the " Working at the coal face " series.

 

Reasons for the rise:

 

1. The stock has been undervalued for years and the market finally realizes its worth. Actually its price should be close to that of Tabcorp- $A10.40!

 

2. The Hamilton casino can now be built.

 

3.The court case re Hamilton's license has benefitted SKC: there won't be another casino built in NZ for years to come!

 

4. Reports indicate that SKC is making good progress with their Adelaide casino: Australians are very keen to work with SKC!

 

5.It originally had a 6.8% stake in Canbet, an online Australian betting company and increased it to a third last December.

 

Canbet just reported a large increase in turnover and suggested that it will soon be able to report a profit. Betting on US sports is their mainstay.

 

6. SKC has a high dividend yield coupled with good growth prospects.

It also has an excellent Board who's abilities mirror those needed!

 

7. It is now heavily tipped by brokers: There are not that many desirable investments leftl

 

8. Tourist numbers have been increasing at a high rate. The lower dollar would also induce locals to spend their holidays in NZ.

 

Finally, SKC will report on Feb.19; they will have some heavy borrowing due to expansion.

There will be some money spent in Adelaide but normally their cashflow is very strong!

 

They now have a high but well planned expenditure on many projects: Spend first, then derive the benefits! 

 

Gerry

( foundation shareholder )