Star Entertainment Shares Plummet to Record Low Amid Financial Struggles

2 min read | November 29, 2024 05:58 PM AEDT | By Team Kalkine Media

Star Entertainment Shares Plummet to Record Low Amid Financial Struggles — Image source: Shutterstock

Financial Struggles and Losses

Star Entertainment revealed that its unaudited EBITDA loss for the first four months of FY25 had reached AU$27 million (US$17.6 million), up from a Q1 EBITDA loss of AU$18 million. The company’s struggles are compounded by a combination of challenging market conditions and liquidity constraints, which have hindered its ability to stabilize operations.

These financial setbacks have raised concerns about the company’s ability to recover and return to profitability in the near future. As a result, analysts from both Macquarie and Jefferies have downgraded their outlook for the company.

Analyst Downgrades and Market Reactions

Macquarie downgraded Star Entertainment's stock to "underperform" from "neutral," slashing its price target by 17% to AU$0.20. The downgrade reflects concerns over the company's ability to stabilize and achieve profitability in the short term. Similarly, Jefferies reduced its price target to AU$0.15 from AU$0.22, stating that it is challenging to foresee any earnings recovery for the casino operator in the near future.

The stock’s poor performance has made it the top loser on the ASX 200 index (AXJO), down a staggering 62.1% for the year as of the latest close.

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