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MIDAS SHARE TIPS UPDATE: Our bowling venue tip Hollywood Bowl is right on target


MIDAS SHARE TIPS UPDATE: Our tip Hollywood Bowl is right on target as it rises 27% in two years

Most people will be digesting the results of the General Election this Friday. But Hollywood Bowl will be busy reporting figures for the year to September 30.

The timing could be better but the results themselves should be impressive, with sales up nearly 8 per cent to £130million and profits 11 per cent ahead at £26.7million. 

The dividend is forecast to rise more than 13 per cent to 7.1p, and a special dividend will almost certainly be added in, just for good measure.

Upbeat: Hollywood Bowl sales and profits are expected to have grown this year

Upbeat: Hollywood Bowl sales and profits are expected to have grown this year

In 2017, chief executive Stephen Burns paid a special of 3.33p, that rose to 4.33p last year and this year should see a payment of at least 5p.

Robust growth has had the desired effect on Hollywood Bowl shares. Midas recommended the stock in December two years ago at £1.89. Today the price is £2.38 and should continue to rise.

Back then, Hollywood had 58 centres nationwide. Today, it has 60, including the largest in the country at Intu Lakeside, an out-of-town shopping mall in Essex. 

Burns expects to open two a year between now and 2023, all featuring state-of-the-art bowling lanes, amusement arcades and plenty of food and drink.

Hollywood is branching into indoor mini-golf as well, opening three Puttstars next spring in Thorpe Park, York and Rochdale. Taking advantage of modern technology, these will offer a new take on traditional mini-golf, with more exciting courses, digital scoring and other amusements.

Robust growth has had the desired effect on Hollywood Bowl shares

Robust growth has had the desired effect on Hollywood Bowl shares

Burns reckons that this could be a whole new growth area for his firm. Like ten-pin bowling, mini-golf can be fun for all generations. Both are fairly low cost and offer families and groups of friends the chance to spend time together. 

Mini-golf has also suffered from under-investment in the past and Burns hopes that customers will flock to his souped-up sites, in much the same way as they come to play on the lanes. Interestingly too, bowling customers have continued to turn up and spend their cash, regardless of economic and political uncertainty.

Midas verdict: Hollywood Bowl is increasing sales and profits and the shares offer an alluring yield of more than 5 per cent, including the special dividend. There has been a decent uplift in the stock since 2017 but, at £2.38, the share price offers more mileage for both existing and new investors.

 





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