4 reasons Crown Resorts Ltd may win big

With its long-term prospects, this is one of the most attractive blue chips currently available…

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Gaming and entertainment business Crown Resorts Ltd (ASX: CWN) certainly has my attention, and it deserves your attention too.

In the time that the S&P/ASX 200 Index (Index: ^AXJO) (ASX: XJO) has edged forward 2.5% since late January, shares in Crown Resorts have dipped 12.6% to now be sitting at just $15.76 – near their lowest level since September last year.

While a number of Australia’s other blue chip stocks remain overpriced based on their future earnings potential, here are four good reasons you should put your money behind Crown Resorts…

  1. Granted, the 2.4% dividend yield offered by Crown Resorts isn’t quite as attractive as those offered by companies like Telstra Corporation Ltd (ASX: TLS) or Westpac Banking Corp (ASX: WBC), but there is certainly room for it to grow. The gaming company will receive more dividends from its interest in Melco Crown Entertainment which could well lead to Crown improving its own dividend policy somewhere in the near future.
  2. Alternatively, the additional money could also be spent on its various other developments, leading to better returns in the long run. It’s a win-win!
  3. Despite taking a hit recently due to the Coalition Government’s horror budget, consumer confidence is on the way up! Although Crown is generally immune to economic downturns due to the nature of its business, consumers are likely to be even more confident to open their wallets as confidence returns, which spells out better earnings for Crown.
  4. The company possesses some serious growth potential, both in Australia and abroad. While the company has planned upgrades for existing Australian facilities and will open its new Barrangaroo resort in Sydney in the coming years, changing gambling laws could also open a pathway into key regions like South Korea and Japan.

An even better punt than Crown Casino…

Putting your money on the table with Crown Resorts’ shares today could certainly prove to be an excellent bet in the long-term.

Motley Fool contributor Ryan Newman does not own shares in any of the companies mentioned.

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