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Lottery Corporation Limited
(Sydney:TLC)
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Rating:65Neutral
Price Target:
AU$6.00
▲(10.29% Upside)
Action:Reiterated
Date:08/04/26
The score is primarily supported by solid cash flow strength and a resilient earnings update despite jackpot-driven volatility, while the balance sheet leverage and a high P/E valuation are the main constraints. Technicals are mildly supportive but not strong enough to outweigh valuation and leverage risks.
Positive Factors
Strong free cash flow
Robust free cash flow and high operating-cash-flow-to-net-income conversion provide durable internal funding. This strengthens dividend coverage, supports FY26 capex and digital investment, and offers capacity to pay down debt or absorb revenue volatility without external financing.
Negative Factors
High leverage
Material leverage and a low equity ratio limit financial flexibility. With net debt/EBITDA near the bottom of a 3–4x target and rising interest costs, the company may face constrained capacity for large investments or higher dividends if revenue softness persists.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong free cash flow
Robust free cash flow and high operating-cash-flow-to-net-income conversion provide durable internal funding. This strengthens dividend coverage, supports FY26 capex and digital investment, and offers capacity to pay down debt or absorb revenue volatility without external financing.
Read all positive factors
Lottery Corporation Limited (TLC) vs. iShares MSCI Australia ETF (EWA)
Market Cap
AU$12.11B
Dividend Yield2.98%
Average Volume (3M)3.68M
Price to Earnings (P/E)33.1
Beta (1Y)0.48
Revenue Growth-2.78%
EPS Growth-2.45%
CountryAU
Employees900
SectorConsumer Cyclical
Sector Strength84
IndustryGambling, Resorts & Casinos
Share Statistics
EPS (TTM)0.16
Shares Outstanding2,225,771,700
10 Day Avg. Volume3,852,037
30 Day Avg. Volume3,678,235
Financial Highlights & Ratios
PEG Ratio-2.11
Price to Book (P/B)36.85
Price to Sales (P/S)3.18
P/FCF Ratio25.23
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
AU$5.79Price Target Upside6.52% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering9
EPS Forecast (FY)0.18
Revenue Forecast (FY)AU$4.14B
Lottery Corporation Limited Business Overview & Revenue Model
Company Description
The Lottery Corporation Limited is an Australian entity primarily involved in the lottery and keno industries. Its operations are conducted under the well-known brands The Lott and Keno. Customers can access its services both online and via an ext...
How the Company Makes Money
TLC makes money primarily from selling lottery products to customers and retaining a portion of sales after paying out prizes and mandatory amounts such as taxes, levies, and other statutory contributions required under Australian lottery regulati...
Lottery Corporation Limited Earnings Call Summary
Earnings Call Date:Feb 17, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Aug 19, 2026
Earnings Call Sentiment Positive
The call portrayed a broadly resilient business that delivered solid financial outcomes despite the weakest jackpot environment since listing. Key positives include stable revenue ($1.8bn), EBITDA resilience ($367m, down 0.7%), maintained dividend ($0.08 fully franked), strong digital traction (41.2% digital lottery turnover), Keno and Instant Scratch‑Its outperformance, and a healthy balance sheet with $560m liquidity. Offsetting these are significant short-term headwinds driven by jackpot variability (circa $400m turnover impact and ~$26m EBITDA drag), a fall in active customers to 8.6m, Powerball softness, and ongoing regulatory/license risks. Overall, management emphasized strategic opportunities in digital, product refreshes (Saturday Lotto, Set for Life) and disciplined capital allocation to drive growth and smooth volatility over time.Positive Updates
Resilient Revenue Base
Group revenue of $1.8 billion in H1 FY26, demonstrating diversification across games and channels that cushioned jackpot variability.
Negative Updates
Unusually Weak Jackpot Environment
H1 FY26 experienced the leanest jackpot run since listing; Division 1 offers for jackpot games were down 14% on the prior corresponding period, materially reducing participation.
Read all updates
Q2-2026 Updates
Positive
Negative
Resilient Revenue Base
Group revenue of $1.8 billion in H1 FY26, demonstrating diversification across games and channels that cushioned jackpot variability.
Read all positive updates
Company Guidance
Management reiterated FY26 financial guidance and priorities: H1 revenue A$1.8bn, H1 EBITDA A$367m (‑0.7%), H1 OpEx A$146m (+2.9%) and FY26 OpEx guidance A$310–320m; H1 CapEx A$34m with FY26 CapEx guidance A$90–100m (ramping in H2). Net debt/EBITDA is ~3x (bottom of 3–4x target), available liquidity A$560m, average debt tenor 4.5 years and ~85% of debt fixed/hedged; interest expense rose 2%. Management confirmed an interim fully franked dividend of A$0.08 per share (103% of H1 NPAT), noted Division 1 offers were down 14% PCP with jackpot headwinds reducing turnover by ~A$400m and EBITDA by ~A$26m, and highlighted digital share at 41.2% alongside Keno retail +7%, online Keno +3.5%, Instant Scratch‑Its +8.5% and Lucky Lotteries +60%, while reiterating the aim to keep OpEx growth below normalized revenue growth and to detail strategy at an Investor Day mid‑year.Lottery Corporation Limited Financial Statement Overview
Summary
Income Statement
70
Positive
Balance Sheet
55
Neutral
Cash Flow
80
Positive
| Breakdown | TTM | Jun 2025 | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 3.76B | 3.73B | 3.98B | 3.50B | 3.28B | 2.95B |
| Gross Profit | 2.81B | 3.73B | 3.07B | 2.74B | 2.65B | 2.36B |
| EBITDA | 744.20M | 763.70M | 788.90M | 608.70M | 586.80M | 498.30M |
| Net Income | 363.10M | 365.50M | 414.00M | 264.80M | 346.60M | 399.30M |
Balance Sheet | ||||||
| Total Assets | 4.46B | 4.41B | 4.36B | 4.37B | 4.22B | 2.71B |
| Cash, Cash Equivalents and Short-Term Investments | 580.80M | 550.50M | 504.00M | 841.30M | 640.50M | 427.20M |
| Total Debt | 2.58B | 2.50B | 2.48B | 2.55B | 2.49B | 3.20M |
| Total Liabilities | 4.12B | 4.08B | 4.00B | 4.11B | 3.97B | 2.44B |
| Stockholders Equity | 339.60M | 321.80M | 363.10M | 264.80M | 242.80M | 272.30M |
Cash Flow | ||||||
| Free Cash Flow | 528.50M | 470.10M | 424.30M | 376.90M | 600.00M | 287.70M |
| Operating Cash Flow | 617.10M | 541.70M | 492.80M | 456.50M | 624.40M | 308.90M |
| Investing Cash Flow | -111.50M | -96.00M | -87.60M | -121.20M | -63.50M | 19.20M |
| Financing Cash Flow | -417.70M | -414.70M | -393.80M | -217.00M | -456.60M | -330.70M |
Lottery Corporation Limited Technical Analysis
Negative
5.44
Price Trends
5.52
Negative
5.46
Negative
5.35
Positive
Market Momentum
-0.02
Positive
45.62
Neutral
26.15
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:TLC, the sentiment is Negative. The current price of 5.44 is below the 20-day moving average (MA) of 5.53, below the 50-day MA of 5.52, and above the 200-day MA of 5.35, indicating a neutral trend. The MACD of -0.02 indicates Positive momentum. The RSI at 45.62 is Neutral, neither overbought nor oversold. The STOCH value of 26.15 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AU:TLC.
Lottery Corporation Limited Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | AU$38.85B | 27.05 | 23.15% | 1.63% | -1.22% | 10.79% | |
72 Outperform | AU$479.57M | 12.20 | 30.58% | 4.84% | 8.48% | -7.58% | |
69 Neutral | AU$2.10B | 62.50 | 2.62% | 2.82% | 5.46% | ― | |
65 Neutral | AU$12.11B | 33.12 | 109.80% | 2.99% | -2.78% | -2.45% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
61 Neutral | AU$9.72B | 17.81 | 113.60% | ― | 0.17% | -21.07% | |
45 Neutral | AU$895.76M | -1.52 | -57.00% | ― | -26.19% | 89.24% |
* Consumer Cyclical Sector Average
AU:TLC
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Lottery Corporation Limited Corporate Events
Lottery Corporation cancels 385,937 lapsed performance rights
Jul 3, 2026
The Lottery Corporation Limited has notified the market of the lapse of 385,937 performance rights under its ASX-listed securities, after conditions attached to those rights were not met or became incapable of being satisfied. The cessation of the...
The Lottery Corporation Unveils Investor Day Presentation on Growth Plans
Jun 2, 2026
The Lottery Corporation Limited has released its Investor Day presentation and will webcast the event live for investors and analysts, with an archived version to be made available on its website later today. The presentation, authorised by the Ma...
Lottery Corporation discloses director Megan Quinn’s share purchase
May 13, 2026
The Lottery Corporation Limited has disclosed a change in director Megan Quinn’s relevant interests, noting that her superannuation fund acquired 36,146 ordinary shares in the company via an on-market trade on 12 May 2026. The purchase, valu...
Lottery Corporation director lifts shareholding in on-market purchase
May 8, 2026
The Lottery Corporation has reported a change in the shareholding of non-executive director Doug McTaggart, in line with ASX disclosure requirements. McTaggart acquired 20,000 ordinary shares via an on-market trade on 7 May 2026, increasing his di...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.