Jumbo Interactive Ltd’s (ASX:JIN) share price jumps higher on strong forecast

Online Lottery

Shares in small-cap online lottery business Jumbo Interactive Ltd (ASX:JIN) have jumped 16 cents or 3.45% higher this morning on the release of its trading update for the FY18.

Compared to the prior corresponding period, Total Transaction Value (TTV) is expected to be up about 25% to around $182 million and revenue about 22% higher, expected to reach $39.4 million.

The TTV growth is expected to increase Net Profit After Tax by about 45% to $11 million.

Jumbo announced that it expects the number of large jackpots (OZ Lotto/ Powerball Division 1 jackpots of $15 million or above) to increase to 32, one more than last year’s 31.

The Company also announced a fully franked special dividend of 8.0c per ordinary share, the second special dividend for FY18. Jumbo has suspended its Dividend Reinvestment plan for the special dividend, and says it still remains in a sound position in terms of cash and franking credits for its ongoing capital management considerations.

CEO and Founder, Mike Veverka commented: “The strong performance expected in the financial year is driven by continual improvements in marketing that have engaged existing customers as well as acquiring new customers”.

The Jumbo Interactive Ltd share price has gained over 82.5% over the last 12 months, compared to ASX 200 which has risen around 4.14%.

With a market capitalisation of $248.7 million, Jumbo Interactive Ltd is the 502nd largest company quoted on the ASX.

From a valuation perspective, Jumbo Interactive Ltd trades on a price to earnings (P/E) ratio of 27.1 times earnings.

In the past year, Jumbo Interactive Ltd has paid total dividends of $0.125 per share. The stock trades on a fully franked dividend yield of 2.69%. 

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Contributors to this article may own shares in some of the companies mentioned in this article. The Capital Club has a thorough disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
Lauren Surplice is a keen follower of the stock market, investing in individual companies and funds. She follows the daily stock market news, covering the ASX stocks that are moving the markets. You can contact Lauren at laurens@thecapitalclub.com.au