2 shares you could have a bet on

There are a certain group of shares that are called ‘sin stocks’. Gambling businesses are part of that lovely group and it could be worth investing in these two shares:

Tatts Group Limited (ASX: TTS)

Tatts is the operator of Australia’s national lottery and many other types of gambling games.

The business has been under pressure due to competition from other operators where you can bet on the outcome of a lottery, rather than entering that lottery itself. Lottoland is the main competition in this space.

However, there has been a lot of unhappy talk about how Lottoland is reducing government revenue and of course Tatts revenue too.

If Lottoland starts being banned in various Australian states then Tatts could win back some of its customers and positive sentiment from the market.

Tatts is currently trading at 24x FY18’s estimated earnings with a grossed-up dividend yield of 6.25%.

Crown Resorts Ltd (ASX: CWN)

Crown is going through a bit of a slump at the moment. The loss of some VIP gaming revenue has damaged the profit and the share price.

However, I think Crown has a lot to be positive about. It is growing its non-gambling revenue, it is on track to build Crown Sydney at Barangaroo and a new hotel at Melbourne’s Crown complex. Its online wagering is also going well with Crownbet growing strongly.

Crown is currently trading at 21x FY18’s estimated earnings with a partially franked dividend yield of 5.14%.

Foolish takeaway

I think both shares are worth considering but Crown is definitely my favourite. In a few years it could easily grow profit strongly when its projects are complete and the VIP gamers return.

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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of Crown Resorts Limited. 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 Bruce Jackson.

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