From the Blue Index blog

Dont bet on Ladbrokes
May 15th, 2009

Shares in bookmaker Ladbrokes (LAD) were looking like a good recovery play up to this morning, having regained over 50% of their value after the October low of 133p last year

But this morning, Ladbrokes reported a 34% slump in profits for the first four months of 2009. Profits from big spending high rollers tumbled to just GBP25m from GBP40m in 2008, with punters enjoying a particularly good Cheltenham Festival in March. These abnormal gross win margin levels, increased free bets and unfavourable cost phasing in eGaming against the previous year resulted in the profits slump, although CEO Chris Bell was at pains to point out the rate of decline is not representative of our expectations for the year, and he said the decline has already given way to more normal trends in May. And overall, added Chris Bell, the general resilience of the business and strong cost controls gives us confidence in the outturn for the full year.

But brokers Noble, Shore Capital and Daniel Stewart all see the results as disappointing and weaker than expected, particularly given that results at rival William Hill are strong and in stark contrast

Full transcript here
http://blog.blueindex.co.uk/2009/05/dont-bet-on-ladbrokes/

George - Worth a read!

Thanks for that skinny, it sure is looking gloomy for LAD and WMH with online outfits increasing popularity.
2517

So with all this gloom around LAD it could be a buying opportunity, sp now around 145p.
2517

Good luck George.

Glad to see them struggling !

They always were a greedy bookies, worst prices, the final straw was a football i placed with them recently, a double, both teams won after being behind in the first half, they refused to pay out one match because it had kicked off some ten minutes, strange how the computer picked this up when i came to collect my winnings but not when i placed the bet so it was a win win situation for them and the manager refused to use a little discretion and pay me out so their loss as i
wont use them again as a means of convenience.

140p+/- is the low so possibly a buying opportunity for a short term bounce.
From FT chat:
"The old struggling bookmaker line is (of course) one of the oldest tricks in the turf accountant text book - as punters are encouraged to bet more having fallen for the idea that somebody else is the mug for a change. Not for long.
This PR puff story tends to surface each year, and only the details vary. One of the more imaginative efforts came in 2005, when William Hill blamed the Racing Posts chief tipster Tom Segal for its woeful first half.
Did punters luck hold out? Of course not. When Hills eventually reported its full year numbers, both turnover and profit had experienced healthy hikes. What price on the same happening again?"

Evolution Dated 08/10/09:
DETAILS "Ladbrokes rights issue comes as a surprise given managements recently stated confidence in the sustainability of the debt structure. Market concern over poor sporting results means that the issue is being priced at a relatively very low share price. We believe trading results have been poor as a result of abnormal sporting results which will normalise. However, the online business appears to have lost its way and is now a drag on growth having once been seen as a potential future growth driver.
VALUATION AND RECOMMENDATION Our negative view was founded on capital structure and the risk from Hilton Hotels. The rights issue reduces the capital structure risk but the hotel risk remains. We retain our Sell rating and 150p price target ahead of adjusting for the rights issue. The nil paid rights start trading tomorrow which may cause a technical squeeze on the shares.
While the fresh capital raise assuages some of our concerns over capital structure we remain concerned over the hotel liability black hole and stick with our Sell rating.

If Ladbrokes did not have their revenues from their roulette arcade machines
they would be almost finished/loss making as a bookie, betfair has all the market, people in this econemy will get wise and go for better prices, a 12/1 shot on Ladbrokes will be 16-20/1 with betfair, same applies for all the bookies but eventually their long line of "mug" punters will realise their roulettes are not random draw generators and a simply a line of ready cash for Ladbrokes.

I've read of 3 investment co's having shorted LAD so maybe I'll postpone a purchase until the dust settles.
2517

Would be interesting to know when they are closing them, George. 140 looks to be the bottom on the chart.

Would see some strength when they do, the 140p mark is and has been the bottom over many years that I recall (haven't checked).
2517

The shares hit 130ish in 2003 - not that I think that has much weight here!

More here!

I used to know of a site where you could find out how much of a company's stock was out on loan. Seem to have lost it. If they shorted from 200/180 then they must be getting close to taking profit or at least tightening up their stop.

ADVFN used to hold the info but stopped last year when the shorting shite hit the fan.

lad will drop a bit more yet imo

Not far off the bottom though, imo. 135p maybe???

that seems about right - 135 to 140

More Ladbrokes shares shorted
Business Financial Newswire
New York-based asset manager Highbridge Capital Management has shorted 0.51% of Ladbrokes shares which are subject to a rights issue.



Story provided by Business Financial Newswire

"Nomura has cut its price target from 185p to 135p, explaining that 28p of the 50p cut is to reflect the dilutive aspect of the one for two rights issue while the rest is due to a lowering of earnings forecasts following last Thursdays statement."