Long DUE and TTS

Don't get me wrong, I'm still a bear on this market over the next 6 to 12 months (heck - I expect a breakdown in the commodities complex sooner than that). It's just that I like the look of defensives at the moment.

We've already spoken about CEU and TCL (at the right price)...and I will get around to having a run through VIR that is part of my super portfolio...but today its DUE and TTS - both of which I bought today.

Time is short - so in brief:

TTS

I look upon it as a quality cashflow business valued on the basis of continuing operations - with upside from potential to win gaming business from Tabcorp.

The Victorian pokies business finishes up in a couple of years. It's a rapidly amortising annuity with a large kicker at maturity (there is no way that the State govt can get around not having to pay the $550m they owe to TTS). The current valuation places little value on this lump sum.

Dick McIlwain is one of the best managers in the country. A clear strategic thinker, he knows how to get the best out of the limited opportunities to bid for licenses. I'm happy to back him as Tatts seeks a booth at the track in Victoria.

Have a look at the chart - I like the stock at current levels. But I'd be buying with ears pinned back if it were to revisit its lows.

...having trouble with my internet connection...an hour has passed since I wrote this note, I should have known it right from the start...or something like that...gotta go pickup the kids