market folly

We're posting up notes from the Sohn Canada Investment Conference 2015 (Capitalize For Kids.)  Next up is Reno Giancola from Alignvest who pitched a long of Great Canadian Gaming.

Reno Giancola's Capitalize For Kids Presentation

-    Long Great Canadian Gaming
-    50% upside
-    Rod Baker – CEO since 2009
-    Reasons for upside: underlevered, strong ROIC, Unique assets
-    Vancouver BC location with many VIP gamblers, have 50% market share in BC
-    River rock is a unique assets with revenue per table of 2x the market average
-    Relaunched Hard Rock Casino Vancouver due to construction in the area and should reach previous revenue levels in 2016
-    Ontario gaming is an area for growth as bundles are sold, they have purchased 1 for $50MM and expect 20% ROIC on the purchase
-    Buybacks will drive further shareholder value
-    Can grow earnings 45% if they releverage
-    Own the real estate, trend to spin off assets into REITs, could unlock additional value
-    $31-32 price target excluding buybacks and M&A
-    Cheap compared to Australian gaming industry, comparable due to Asian consumers


Be sure to check out the rest of the presentations from the Capitalize For Kids Conference.