These 5 stocks look odds on winners

The odds of ‘beating the house’ aren’t great. You’re better off owning ‘the house’!

| More on:

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

It’s hardly news that Australians and indeed many people around the world enjoy placing the odd bet. These bets occur on the races, by purchasing of a lottery ticket, putting coins in a poker machine and gambling at a casino. Interestingly businesses in this sector are often described as ‘recession proof’. By this I mean that whether the economy is strong or struggling, people still seem to continue their spending habits on gambling associated pastimes.

This defensive quality, coupled with the growth in Chinese gambling in Macau is no doubt a major factor in billionaire James Packer’s increased focus on gambling-related businesses.

The ASX offers an impressive selection of attractive gambling-related businesses. While the ever present risk of regulatory changes – as Echo Entertainment Group Ltd (ASX: EGP) found out recently – can certainly affect the outlook for companies exposed to the sector, on the whole the future growth potential of the following five stocks is promising indeed.

1)      Crown Resorts Ltd (ASX: CWN) provides shareholders with an investment alongside James Packer. The company owns casinos in Perth and Melbourne and will soon have a casino in Sydney. Crown also has an ownership interest in Crown Melco which owns the City of Dreams casino in Macau, China.

2)      Aristocrat Leisure Limited (ASX: ALL) is a leading manufacturer of poker machines. Aristocrat has impressively grown its operations to a position where it now has a footprint in over 90 countries around the globe.

3)      Tatts Group Limited (ASX: TTS) – For investors looking for exposure to the consistency of lotteries, wagering and sports betting then Tatts Group could be the answer. Without the ups and downs of VIP wins and losses which casinos must endure, Tatts’ earnings should be steadier and more reliable.

4)      Donaco International Ltd (ASX: DNA) is a stock off the radar of many investors, although that appears set to change. The company operates the first fully licensed table gambling business in Vietnam, with the property currently undergoing a major renovation and expansion. Donaco has recently tapped investors for more funds with a number of high profile fund managers backing the raisings, meaning the stock won’t be off the radar of investors for much longer.

5)      Jumbo Interactive Ltd (ASX: JIN) has carved itself out an exciting niche as the software and website provider of online lottery sales. Jumbo has achieved this feat both in Australia and abroad by partnering with major lottery providers. Its recent entry into Mexico and Germany which are much larger markets than Australia has the potential to result in significant growth for the company.

Foolish takeaway

As investors we are always looking for when the odds are stacked in our favour. Profitable gambling businesses are also very clever at stacking the odds in their favour which can make them superbly profitable businesses to own.

Motley Fool contributor Tim McArthur owns shares in Echo Entertainment Group Ltd.

More on ⏸️ Investing

Close up of baby looking puzzled
Retail Shares

What has happened to the Baby Bunting (ASX:BBN) share price this year?

It's been a volatile year so far for the Aussie nursery retailer. We take a closer look

Read more »

woman holds sign saying 'we need change' at climate change protest
ETFs

3 ASX ETFs that invest in companies fighting climate change

If you want to shift some of your investments into more ethical companies, exchange-traded funds can offer a good option

Read more »

a jewellery store attendant stands at a cabinet displaying opulent necklaces and earrings featuring diamonds and precious stones.
⏸️ Investing

The Michael Hill (ASX: MHJ) share price poised for growth

Investors will be keeping an eye on the Michael Hill International Limited (ASX: MHJ) share price today. The keen interest…

Read more »

ASX shares buy unstoppable asx share price represented by man in superman cape pointing skyward
⏸️ Investing

The Atomos (ASX:AMS) share price is up 15% in a week

The Atomos (ASX: AMS) share price has surged 15% this week. Let's look at what's ahead as the company build…

Read more »

asx share price competitions represented by businessmen arm wrestling
Retail Shares

How does the Temple & Webster (ASX:TPW) share price stack up against Nick Scali (ASX:NCK)?

How does the Temple & Webster (ASX: TPW) share price stack up against rival furniture retailer Nick Scali Limited (ASX:…

Read more »

A medical researcher works on a bichip, indicating share price movement in ASX tech companies
Healthcare Shares

The Aroa (ASX:ARX) share price has surged 60% since its IPO

The Aroa (ASX:ARX) share price has surged 60% since the Polynovo (ASX: PNV) competitor listed on the ASX in July.…

Read more »

asx investor daydreaming about US shares
⏸️ How to Invest

How to buy US shares from Australia right now

If you have been wondering how to buy US shares from Australia to gain exposure from the highly topical market,…

Read more »

person reading news on mobile phone
⏸️ Investing

Why Fox (NASDAQ:FOX) might hurt News Corp (ASX:NWS) shareholders

News Corporation (ASX: NWS) might be facing some existential threats from its American cousins over the riots on 6 January

Read more »