Sun International Limited. JSE: SUI

Sun International shares

Background of Sun International

  • The Sun International Group is one of the premier gaming and leisure groups in South Africa, boasting a diversified asset portfolio including hotels, casinos and resorts. Having been established by business magnate Sol Kerzner in 1967, the group has a proud history of growth, and today operates or has an interest in 18 resorts, luxury hotels and casinos, including the flagship Sun City, Grand West Casino and Carnival City. The group has significant interests in the Federal Palace in Nigeria.

  • The group has also diversified into Latin America, with the asset portfolio there being merged to form the largest gaming company on the continent.

  • Sun International employs more than 13 000 people, operates more than 4 000 guest rooms and recorded revenue of more than R12 billion in 2016. Sun International shares are listed on the JSE with a market cap of R9 billion. It has historically been one of the JSE’s blue-chip stocks to buy, but Sun International share price performance has suffered in recent times.

Sun International Shares Growth Driver

  • Sun International grew revenue by 15% to R12.2 billion in 2016, thanks to solid performance from assets in Chile, the addition of new properties, new lines of business and in particularly the insourcing of food and beverage for sale to clients. With the group largely dependent on the South African economy, growth in local businesses has been negatively affected by the constrained economic climate.

  • Casino operations, which account for the majority of group revenue, suffered due to the introduction of alternate forms of gambling and the weak local economy, with a fall off in visitation and spend stemming from the lower end of the customer database. At a trading level, EBITDA increased by 4%, but adjusted earnings per share fell by 21% due to high interest and a higher effective tax rate. The group has forecast that trade conditions will remain tough, and has prepared by investing capital in new systems and analytics to improve gaming revenue, along with on cost containment.

  • Major activities for the year including an upgrade to Sun City, progress with construction of the R4.1 billion Time Square in Pretoria, the finalisation of disposal of non-core assets and the introduction of Tsogo Sun as 20% minority shareholder in the group’s Western Cape assets.

  • Expansion into Latin America has provided opportunities to enhance shareholder value, with economic growth in Chile, Peru, Colombia and Panama being more favourable than in South Africa.

Sun International Group Investor Tip

  • Sun International share price has fallen substantially, from a peak of R138.90 in 2015 to R82.55 by November 2016. Much hinges on the opening of Time Square in 2017, which will be South Africa’s second-largest casino. The decision to buy into emerging markets in South America will also be a key strategy. Currently, investors won’t feel particularly confident to buy Sun International shares, but the general consensus is that the shares are undervalued and could be a bargain buy.

Sun International Major Shareholders

Allan Gray, Prudential Investment Managers, Sanlam

  • Sector

    Consumer Discretionary

  • Industry

    Gaming, Lodging & Restaurants

  • Sub industry

    Casinos & Gaming

How to buy Sun International Group Shares

  • Sun International : How to buy Sun International Group Shares Online

    We have made it simple to buy JSE listed firm shares online. The easiest way to buy Sun International Group shares or stocks is to; start by submitting the ‘BUY THIS SHARE’ form. Next, one of our experienced and certified stock brokers will personally get in contact with you to discuss your custom stock request. Finally, a stock advisor will confirm the amount of shares you are looking to invest in Sun International Group and assist you with the setup and management of your stock portfolio account.

  • Here are the steps you must follow to Buy / Purchase Sun International Group shares with utmost confidence:

    1. Start by Filling in the BUY THIS SHARE form.
    2. Insert your name, email, telephone number and monthly remuneration.
    3. Then, Indicate the amount you are looking to invest in Sun International Group.
    4. Click the “ INVEST NOW” button
    5. Once we have received your info, a dedicated stock advisor will personally call you back to discuss your personal share request.
    6. Lastly, your newly appointed personal stock advisor will handle all account setups and reporting as stipulated by the financial services board of South Africa (FSB)
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