Morningstar

Jumbo Interactive Ltd JIN

Morningstar Rating
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Stock XASX Rating as of
A$13.75 −0.07 (0.51%)
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As of Delayed Price Open

Company Report

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Jumbo Interactive Earnings: Diversification Strategy Proving a Challenge

Angus Hewitt

Jumbo Interactive’s fiscal 2024 underlying EBITDA lifted 30% to AUD 77 million—about 2% above our forecast on strong lottery volumes. Lotteries are crucial to Jumbo, representing over 80% of earnings. But this is also Jumbo’s Achilles' heel. While Jumbo sells tickets to popular lotteries including Powerball and Oz Lotto, the brand equity of these games ultimately lies with wide-moat Lottery Corp. While digital migration is a tailwind for Jumbo, we think Lottery Corp will progressively take share from Jumbo over time, underpinning our no-moat rating for the firm.

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Price vs Fair Value

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JIN is trading at a 529% premium.
Price
A$13.82
Fair Value
A$51.90
Uncertainty
Medium
1-Star Price
A$28.82
5-Star Price
A$8.19
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Lottery ticket sales are increasingly moving online, and the digital channel is underpenetrated in Australia compared with the New Zealand and the UK.

Bears

Lottery Corp. may impose less favorable terms for Jumbo when the current reselling agreement expires in 2030. Alternatively, Lottery Corp. could allow the agreement to lapse entirely.

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Trading Information

Previous Close Price
A$13.82
Day Range
A$13.72–13.90
52-Week Range
A$13.12–18.29
Bid/Ask
A$13.74 / A$13.76
Market Cap
A$865.18 Mil
Volume/Avg
21,707 / 205,077

Key Statistics

Price/Earnings (Normalized)
18.84
Price/Sales
5.48
Dividend Yield (Trailing)
3.94%
Dividend Yield (Forward)
3.98%
Total Yield
4.01%

Company Profile

Jumbo Interactive is a digital reseller of government and charity lottery tickets through its Oz Lotteries platform. Jumbo’s main reselling agreement is with The Lottery Corp., Australia’s exclusive operator of licensed lotteries in all states except Western Australia. Jumbo also licenses its lottery software platform to government and charity clients in Australia, the UK, and Canada, as well as offering additional lottery and raffle management services.
Sector
Consumer Cyclical
Industry
Gambling
Stock Style Box
Small Core
Total Number of Employees
133
Website
https://www.jumbointeractive.com

Competitors

Valuation

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Metric
JIN
TAH
TLC
Price/Earnings (Normalized)
 18.843.2027.91
Price/Book Value
 7.560.8731.51
Price/Sales
 5.480.462.88
Price/Cash Flow
 14.404.4223.21
Price/Earnings
JIN
TAH
TLC

Financial Strength

Metric
JIN
TAH
TLC
Quick Ratio
 1.760.710.54
Current Ratio
 1.900.860.69
Interest Coverage
 135.61−30.604.87
Quick Ratio
JIN
TAH
TLC

Profitability

Metric
JIN
TAH
TLC
Return on Assets (Normalized)
 27.74%0.79%9.22%
Return on Equity (Normalized)
 43.14%1.42%126.55%
Return on Invested Capital (Normalized)
 41.03%2.01%16.75%
Return on Assets
JIN
TAH
TLC

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