Aristocrat Leisure (ALL) Stock Recommendation

ABN has rated the Aristocrat Leisure (ALL) stock with a Buy recommendation. The broker notes that the company stock is not trading at a 47 percent discount compared to competitor International Game Technology (IGT) and also comments that the gap is excessive given that the two companies have similar fundamentals.

Quick Australian Stock Tips

A compilation of updates by brokers:

Australian Broker Stock Tips

Macquarie Research Equities (MRE) maintains a preference for stocks with offshore growth exposures via the current resources boom. MRE favours the following Australian listed stocks: BHP Billiton (BHP), Rio Tinto (RIO) and Woodside Petroleum (WPL). MRE are also overweight international industrials in tight oligopolies (a market is dominated by a small number of sellers) like Rinker (RIN), Brambles (BIL), Aristocrat (ALL) and CSL Ltd. MRE also views the banking sector as a defensive part of a portfolio.

MRE: Aristocrat Leisure (ALL) Stock Recommendation

Macquarie Research Equities (MRE) reiterates their outperform recommendation for the stock Aristocrat Leisure (ALL). MRE have maintained their outperform recommendation despite the weaker Japanese outlook. "The poker-machine manufacturer warned at its AGM that it could post a first-half loss in its Japanese business. Management indicated that proposed changes to regulation, due to take effect on the 1 July 2007, has caused uncertainty in buyers as to whether to take machines which comply with previous guidelines or the proposed new regulations." Shares in Aristocrat fell almost 7%.

MRE: Aristocrat Leisure (ALL) Recommendation

Macquarie Research Equities (MRE) has maintained their outperform recommendation on Aristocrat Leisure (ALL). Last Monday, Aristocrat Leisure (ALL) announced the purchase of the Scandinavian server-based video lottery maker, EssNet Interactive AB, for AUD$70m via a share purchase agreement. Since announcing the deal, ALL shares have dipped over 3%. MRE believes that there is more value in the deal and the market has undervalued the benefits of the transaction in the medium term.

Share Price and Cost Pressures Intensifying… Where are the Risks?

Macquarie Research Equities (MRE) have conducted an extensive analysis of stocks that are at risk of earnings downgrades due to increasing cost pressures. While softer revenues are a problem, the real concern lies with accelerating cost growth that is effectively eating into company margins. Against this backdrop, MRE believe that rising costs present an increasing risk to company Earning Per Share (EPS) growth forecasts for FY06.

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