Question: I am holding a parcel of Tabcorp (TAH) with a gain. Do you think it is time to take the profits off the table?
Answer (By Paul Rickard): The performance of Tabcorp has really surprised me this year. I included it in our Income Portfolio at the start of the year on the basis it provided a reasonable yield and relatively low risk. It was $4.84 at the time. As the Tatts/Tabcorp merger meandered along, it got smashed, falling to under $4.00. When the merger was approved (which was always going to happen), it has rallied strongly to around $5.17.
In terms of the brokers, they see Tabcorp as pretty fully priced. According to FN Arena, the current target broker price is $4.84 (range $4.10 to $5.25).