PBL has staged a big recovery, and thus has become more expensive, at 30X earnings now. It is a bit leveraged, but very strong earnings growth is still expected. While lotteries and its other businesses are typically considered stable, its earnings do not reflect this. Annual earnings have ranged from 19c to $3.13 per share in the last eight years, with a lot of volatility. We think it is an interesting company, but would like to see it at a lower valuation. Also, as a small cap, the stock needs to be considered higher risk regardless. We think it is a decent company, but buyers have time here, in our view.
5i Research Answer: