GAMING GROUP
Sun International shares tumble on downbeat trading update
The sharp share drop surprises market watchers as the gaming group’s medium-term prospects are positive
Gaming group Sun International’s share price plunged after the release of a downbeat trading update covering the six months to end-December. The group owns casinos in SA and Latin America. Sun International shares finished 14% down at R74.95, with the market seemingly flustered by the indicative earnings range. Rival casino group Tsogo Sun was up slightly on the day. Market watchers conceded it was a tough environment for gaming companies, but they were surprised at the sharp drop in Sun International’s share price when medium-term prospects should be boosted by new developments such as the new large casino in Menlyn, Pretoria. The market observers cited possible investor fatigue for the sell-down. Sun International reported diluted adjusted headline earnings, which is regarded as the most meaningful measure of performance, would be between 189c and 223c a share. This is 35% to 45% lower compared with the comparable six-month period in 2015. The results consolidated the operations o...
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