Kenanga IB Research downgrades gaming sector to Neutral
Published on 03 Oct 2019. | Source: theedgemarkets.com
KUALA LUMPUR (Oct 3): Kenanga IB Research has downgraded the Gaming sector to “Neutral” (from Overweight) and said the gaming sector stood out as the star performer this year especially the numbers forecast operator (NFO) players such as Berjaya Sports Toto Bhd and Magnum Bhd which rallied 26% and 47% year-to-date, respectively, boosted by the solid recovery of ticket sales.
In a sector update today, the research house said at one point, the casino operator, Genting Malaysia Bhd (GenM) also recovered considerably after being bashed down heavily end of last year due to a string of negatives such as a 10% casino tax hike, cancellation of Fox Theme Park and RM1.83 billion impairment for the US Tribe’s promissory note.
“However, the recovery was scuttled by the Empire deal in August, putting GenM and Genting Bhd back to a square one.
“ We believe both the NFO players are fully valued after the good run for the year.
“As such, we cut the gaming sector to Neutral from Overweight previously. Having said that, the NFO names still offer above average yield 4% to 6%,” it said.
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