Been casting the old ruler over the two poker machine companies listed on the ASX200...Ainsworth vs Aristocrat. It seems market opinion is definitely with Aristocrat for some reason over the last 6 months. Not sure why.
Ainsworth has no debt, is easily meeting its cost of equity and has a higher dividend yield. Also has free cash flow accounted to equity. I have a price target of around $3.10 - $3.37 which is a premium to the current price of $2.81
Contrast that to our friends at Aristocrat who are not making positive cash flow to equity at the moment as it is busy paying off debt. Add a lowly return on equity and I'd tell you which company I would buy. I won't even put a price target on companies with no positive cash flow to equity.
Still..up to you guys as always. Not a recommendation to invest not invest in either of these stocks.
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