- In late 2021 hotel and casino operator Star Entertainment Group came under regulatory scrutiny over alleged money laundering at its facilities.
- The share price collapsed, with a second inquiry now in progress.
- Despite weak Half-Year 2024 financial results, the share price rose, and analysts remain bullish on the stock.
COVID 19 lockdowns and border closures impacted the financial performance of the hotels and casinos operated by the Star Entertainment Group, followed by softening consumer demand and fines and fees associated with regulatory inquiries.
Star Entertainment Group Financial Performance
Source: ASX
The $2.43 billion dollar posted loss in FY 2023 was statutory, with net profit after tax for the year before significant items up 41%. Half Year 2024 results showed declines across the board – revenues dropped 14.6% and net profit after tax before significant items fell 42.7%. Without the burden of significant item impairments in Half Year 2023, Star posted a statutory net profit of $9 million, a massive improvement over Half Year 2023’s $1.2 billion dollar loss.
Over five years SGR shares have dropped 86.3%, but investors reacted positively to the half year results, sending the share price up 14.4% over the last month.
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Source: ASX
An analyst at Sequoia Wealth Management has a BUY recommendation on Star Entertainment shares, citing the company’s recent uptick in the share price following dramatic losses year over year.
Marketscreener.com has an analyst consensus rating of OUTPERFORM rating on Star shares, with three of the nine analysts reporting at BUY, two at OUTPERFORM , three at HOLD, and one at SELL.
Yahoo Finance Australia has a consensus BUY recommendation on Star, with one of ten analysts reporting a STRONG BUY, seven at BUY, one at HOLD, and one at UNDERPERFORM.
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