a few thoughts: - $15million market cap, $5million cash...

a few thoughts:
- $15million market cap, $5million cash (excluding player funds). Lottery business generating NPAT of 4 to 5 million. If you strip out the cash then you're really only paying 2 - 2.5 times earnings for the lottery business.

Of course the above calc result is a value investors dream - where do you find that sort of value elsewhere in the market, especially combined with the fact that lottery sales should continue to grow with little additional costs.

there are two main problems with this company:
- they have a history of making poor acquisitions - just look at the bath they have taken on the software division. All that cash they are generating might be better in shareholders pockets.
- if lottery reseller contracts are not renewed in a few years then they don't have a business. no point talking PEs of 10 if they only will operate for another 3 years. The MD seems to suggest that these contracts just keep getting rolled over but I think it is still a risk to be aware of.Note: the reseller contracts could also be renewed with a lower % take for Jumbo.

They seem to be on the correct track now by concentrating on the lottery business - maybe the latest director has provided some focus for them. What they really need is to get something going in the US or Europe - if they can replicate the same model in another country then the risks to the lottery business are greatly reduced.

I think the stock is definitely worth buying at this level but it is not without risk