Echo Entertainment Group (EGP) and Lock Out Laws

by Michael Gable

Investment thesis based on:
1. Positive trading for the March quarter saw revenues up 13.2%
2. Matt Bekier joins EGP as CEO/MD provides the company with stability to implement aturnaround strategy
3. Lock out laws in NSW adds to non-gaming revenue growth at The Star casino 
4. Lower capital expenditure means higher cash generation as refurbishment projects start rolling off

Echo had taken a tumble in the last two years but we can see that since about November last year, it has been base building. 
During that time we have seen the Relative Strength Index (RSI) climb from an oversold condition. 
While the price was building a base, the momentum as measured by the RSI, was heading higher. 
It has culminated in a breakout in the EGP share price last week. 
This current level around $2.80 appears to be a bit of an obstacle. 
So if EGP can clear that, then the next levels of resistance are around $3 and then major resistance at $3.40



Disclaimer: Michael Gable is an Authorised Representative (No. 376892) and Fairmont Equities is a Corporate Authorised Representative (No. 444397) of Novus Capital Limited (AFS Licence No. 238168). The information contained in this report is general information only and is copy write to Fairmont Equities. Fairmont Equities reserves all intellectual property rights. This report should not be interpreted as one that provides personal financial or investment advice. Any examples presented are for illustration purposes only. Past performance is not a reliable indicator of future performance. No person, persons or organisation should invest monies or take action on the reliance of the material contained in this report, but instead should satisfy themselves independently (whether by expert advice or others) of the appropriateness of any such action. Fairmont Equities, it directors and/or officers accept no responsibility for the accuracy, completeness or timeliness of the information contained in the report.

Subscribe to our Daily Newsletter?

Would you like to receive our daily news to your inbox?