Insights

The SkyCity (ASX:SKC) share price is up 20% in September. Here’s why…

While the ASX 300 is down 3.2% in the first 2 weeks of September, SkyCity’s share price has surged more than 20%.
The post The SkyCity (ASX:SKC) share price is up 20% in September. Here’s why… appeared first on Motley Fool Australia. –

Hand throwing four red dice

The SKYCITY Entertainment Group Limited (ASX: SKC) share price is on a roll this month, up more than 20% so far in September.

By comparison the S&P/ASX 300 Index (ASX: XKO) is down 3.2% over that same time.

Like most shares, particularly those involved in the entertainment business, SkyCity’s share price was pummeled during the COVID-19 market rout, falling 66% from February 21 through March 23.

Since that low, SkyCity’s share price is up a whopping 122%. Although that hasn’t been enough to recoup all of its viral-induced losses, with the share price still down 25% year-to-date.

What does SkyCity do?

SkyCity owns and operates tourism, leisure and entertainment facilities with a focus on casino gambling. SkyCity shares are listed on the Australian and New Zealand exchanges.

In New Zealand, SkyCity operates casinos in Auckland, Queenstown and Hamilton. Its Australian casino is located in Adelaide. The Adelaide site is undergoing a $330 million expansion, with major works expected to be completed later this year. The company also provides conference facilities and restaurant services, along with hotel accommodations at its Auckland location.

The company has more than 5,000 employees. SkyCity shares began trading on the ASX in 1999. Today the company has a market cap of $2.1 billion.

Why is the Skycity share price smashing the ASX 300 in September?

While the broader market has been selling off, SkyCity share price has been rocketing higher.

Part of the renewed investor interest came following the release of its full year 2020 financial results on September 3. Although SkyCity suffered a 24% fall in normalised revenue, the company forecast that its FY21 normalised earnings before interest, tax, depreciation and amortisation (EBITDA) would be above its FY20 results.

Investors are also likely eyeing a two-fold potential revenue increase from SkyCity. One from the completion of its Adelaide expansion and the completion of its New Zealand International Convention Centre and Horizon Hotel projects. The second from investors with a longer-term horizon who expect SkyCity should see a huge ramp up in its business once the coronavirus is defeated or contained.

Until that happens, the company cautioned it didn’t expect to return to pre-COVID or FY19 EBITDA levels because of “negligible international business and international tourism activity due to ongoing international border closures”.

Still, it’s worth remembering that as recently as 24 January, SkyCity’s share price was 34% higher than it is today.

Man who said buy Kogan shares at $3.63 says buy these 3 ASX stocks now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

In this FREE STOCK REPORT, Scott just revealed what he believes are the 3 ASX stocks for the post COVID world that investors should buy right now while they still can. These stocks are trading at dirt-cheap prices and Scott thinks these could really go gangbusters as we move into ‘the new normal’.

Find out the names of our 3 Post COVID Stocks – For FREE!

*Returns as of 6/8/2020

More reading

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Sky City Entertainment Group Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post The SkyCity (ASX:SKC) share price is up 20% in September. Here’s why… appeared first on Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!