I imagine there are already big players in the US with online offerings, so it would be challenging to see JIN gain any traction unless for some reason, they manage to convince someone with a lottery license to switch to the JIN app.......more likely that it will be a white-label offering replacing the clients system because JIN can convince then that their app ends up with a higher spend per player.
It seems more likely that they will do more Gatherwell like deals where they offer the back-end to small lotteries/charities; this however is going to generate a lot less revenues than what the reseller deal with Tabcorp generates (at least in the next 5 years). I therefore think that although that 10 year deal with Tabcorp on the surface seemed expensive, in hindsight, its good because it generates enough cashflow and gives them enough time to build other parts of the business.
It does mean that growth will moderate (there will be a ceiling to how many people play online), but it seems that JIN are managing to make a lot more even on smaller jackpots (a combination of more people online, as well as more spend per player).....that trend will continue, but its likely that 20-30% growth in that business is in the past.
What matters therefore is powerball/OzLotto and with ~38 jackpots >15m for FY2021 which is in line with FY2020, the shareprice seems to have responded to that (if you recall, 1H21 was pretty poor in terms of jackpots).
IMO JIN should easily do EPS of more than 41.5c (FY2020 EPS), but even if they do ~45c, at current prices its trading at a PE of 35 which seems expensive for a company where growth has slowed......again all the above IMO
JIN Price at posting:
$15.91 Sentiment: Hold Disclosure: Held
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