Valuing casino groups is always a gamble but a revamped LCI is clearly underpriced at 200p a share. It is rated lower than Crockfords, a far more risky business.
LCI, which has a spread of casinos in London and overseas, made pounds 14m pre-tax in the year to March.
This gives pro forma earnings of 22.5p or a historical p/e of 8.9 while pro forma dividends of 11.92p offer a 7.5 per cent yield. Round at Crockfords the comparable figures are 9.6 and 6.3 per cent.
Looking forward, pre-tax profits could be pounds 27.5m this year, translating to a p/e of 8 against 9.3 for Crockfords on market forecasts.Reuse content