With all of its major businesses in Sydney, Brisbane, and the Gold Coast, Star Entertainment could be facing some tough times
The post Star (ASX:SGR) share price struggles following lockdown news appeared first on The Motley Fool Australia. –
At the closing bell, the Star share price was down by 0.27% to $3.63.
Let’s take a look at the lockdown facing parts of Queensland and how it could affect Star Entertainment.
Home you go, Queensland
Queensland’s Premier Annastacia Palaszczuk announced at a press conference earlier today parts of the state will go into lockdown from 6pm tonight until 6pm on Friday.
Southeast Queensland, Townsville, Magnetic Island, and Palm Island will be entering a 3-day lockdown after a travelling hospital worker was found to have COVID-19.
The state’s stay-at-home order will take place while Greater Sydney is undergoing a 2-week lockdown.
The current lockdowns have already caused many ASX travel shares to drop, and investors will be weighing up the possible impact on Star Entertainment.
Star’s lockdown woes
Star Entertainment’s businesses are based in 3 of Australia’s east-coast cities, which are normally a blessing for the hotel and casino operator.
Unfortunately, given the current COVID-19 situation, those cities are Sydney, Brisbane, and the Gold Coast.
Yesterday, Star restated its Sydney casino and hotel, The Star Sydney, will be closed to the public until the end of Greater Sydney’s lockdown. However, it will continue to operate limited hotel facilities.
Sydney’s lockdown was initially for a 7-day period, but it has since been extended. It will now last for a fortnight and end on 9 July.
The company has committed to continuing to pay staff at its Sydney business for the 2-week period.
Today, Star announced it will be closing its remaining casinos at 6pm tonight. The Star Gold Coast and Brisbane’s Treasury Casino & Hotel are expected to reopen on Friday evening. However, there is no guarantee the lockdown will end then.
The company has also committed to keep paying its Queensland-based staff for the duration of the lockdown.
Star Entertainment share price snapshot
The Star Entertainment share price hasn’t been noticeably affected by news of lockdowns. However, its shares have slightly fallen each day since it acknowledged Sydney’s most recent lockdown after close on 25 June. Star shares are currently trading for 1.63% less than they were then.
The Star share price has dropped 2.9% since the start of 2021. However, it’s 33.8% higher than it was this time last year.
The company has a market capitalisation of around $3.4 billion, with approximately 946 million shares outstanding.
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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.