{"id":291051,"date":"2023-09-25T12:25:15","date_gmt":"2023-09-25T17:25:15","guid":{"rendered":"https:\/\/www.casino.org\/news\/?p=291051"},"modified":"2023-09-26T14:18:06","modified_gmt":"2023-09-26T19:18:06","slug":"light-wonder-stock-could-be-propelled-by-rd-spending","status":"publish","type":"post","link":"https:\/\/www.casino.org\/news\/light-wonder-stock-could-be-propelled-by-rd-spending\/","title":{"rendered":"Light & Wonder Stock Has Upside Potential, Says Analyst"},"content":{"rendered":"

Buoyed by a streamlined business model and a robust research and development budget, Light & Wonder (NASDAQ: LNW) stock could deliver significant gains.<\/p>\n

\"Light
Light & Wonder signage at a roulette table, seen above. The stock could be a big winner, says an analyst. (Image: X)<\/figcaption><\/figure>\n

That\u2019s the take of Morningstar analyst Angus Hewitt, who placed a price target of $87 on the stock in new coverage of the gaming device manufacturer. That implies upside of almost 21% from current levels and arrives as the stock shed 7.33% over the past week. While Light & Wonder might not wrest significant market share from rival Aristocrat Leisure, the analyst noted that the company should be able to protect its turf against smaller rivals.<\/p>\n

Light & Wonder significantly simplified its business by divesting noncore lottery and sportsbetting assets,\u201d wrote Hewitt. \u201cLight & Wonder is now a more focused entity, cut in much the same image as dominant competitor Aristocrat, with operations across social casino, iGaming, and electronic gaming machines (EGMs).\u201d<\/p><\/blockquote>\n

In North America, Aristocrat, Light & Wonder, and International Game Technology (NYSE: IGT) combine to control approximately 80% of the slot machine market in land-based casinos.<\/p>\n

Simplified Light & Wonder Thesis Could Help Stock<\/h2>\n

In 2021, the company formerly known as Scientific Games sold its lottery<\/a> and sports betting units in transactions that raised about $7 billion in cash.<\/p>\n

\n

Those transactions dramatically reduced debt, eliciting praise from Wall Street, and also simplified the Light & Wonder investment thesis. It did so while allowing the firm to direct some proceeds to faster-growing segments<\/a>, including iGaming. That influx of capital also supported enhanced research and development efforts.<\/p>\n<\/div>\n

\u201cTo maintain share over the long run in the fiercely competitive EGM market, manufacturers need to consistently deliver new, high-quality games that keep consumers engaged and maximize revenue for gaming venues,\u201d added Hewitt. \u201cThis requires continuous spending on research and development.\u201d<\/p>\n

Light & Wonder spends a smaller percentage of sales on research and development than Aristocrat, but it outspends IGT. Still, Light & Wonder has iGaming and social casino inroads. Last month, the company said that it is acquiring<\/a> 17% of the social casino developer it doesn\u2019t yet own. That paves the way for a reunion with the company it spun off in 2019. The deal is scheduled to close in the fourth quarter.<\/p>\n

Why Light & Wonder R&D Matters<\/h2>\n

When assessing the merits of Light & Wonder shares, the company\u2019s ability to execute on the research and development front is critical. That\u2019s particularly true at a time when slot sales are flat relative to 2019 levels, but casino operators are looking to upgrade, implying room for growth.<\/p>\n

Additionally, steady research and development efforts can smooth out some volatility associated with manufacturers’ success with one new game while struggling to gain traction with others.<\/strong><\/p>\n

\u201cR&D investment is necessary to ensuring a healthy pipeline of new products, software developments, and platform enhancements, helping them to stimulate demand and differentiate them from peers,\u201d concludes Hewitt. \u201cWhile the occasional hit game can come down to chance, we expect consistency in developing and deploying popular titles will come down to investment over the long run. This is crucial to the long-term success of any gaming machine manufacturer.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

Buoyed by a streamlined business model and a robust research and development budget, Light & Wonder (NASDAQ: LNW) stock could deliver significant gains. That\u2019s the take of Morningstar analyst Angus Hewitt, who placed a price target of $87 on the stock in new coverage of the gaming device manufacturer. That implies upside of almost 21% […]<\/p>\n","protected":false},"author":46,"featured_media":246760,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[10,69293],"tags":[81903,81890],"acf":[],"yoast_head":"\nLight & Wonder Stock Could Be Propelled By R&D Spending<\/title>\n<meta name=\"description\" content=\"Light & Wonder stock could be winner as R&D commitment firms.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.casino.org\/news\/light-wonder-stock-could-be-propelled-by-rd-spending\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Light & Wonder Stock Could Be Propelled By R&D Spending\" \/>\n<meta property=\"og:description\" content=\"Light & Wonder stock could be winner as R&D commitment firms.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.casino.org\/news\/light-wonder-stock-could-be-propelled-by-rd-spending\/\" \/>\n<meta property=\"og:site_name\" content=\"Casino.org\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/Casino.OrgNews\" \/>\n<meta property=\"article:published_time\" content=\"2023-09-25T17:25:15+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2023-09-26T19:18:06+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/12\/lnw.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1920\" \/>\n\t<meta property=\"og:image:height\" content=\"1080\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Todd Shriber\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@etfgodfather\" \/>\n<meta name=\"twitter:site\" content=\"@Casino_Org\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Todd Shriber\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.casino.org\/news\/light-wonder-stock-could-be-propelled-by-rd-spending\/\",\"url\":\"https:\/\/www.casino.org\/news\/light-wonder-stock-could-be-propelled-by-rd-spending\/\",\"name\":\"Light & Wonder Stock Could Be Propelled By R&D Spending\",\"isPartOf\":{\"@id\":\"https:\/\/www.casino.org\/news\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.casino.org\/news\/light-wonder-stock-could-be-propelled-by-rd-spending\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.casino.org\/news\/light-wonder-stock-could-be-propelled-by-rd-spending\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/12\/lnw.jpg\",\"datePublished\":\"2023-09-25T17:25:15+00:00\",\"dateModified\":\"2023-09-26T19:18:06+00:00\",\"author\":{\"@id\":\"https:\/\/www.casino.org\/news\/#\/schema\/person\/f4cecf70a5032bc4e60eb73fc86d4a85\"},\"description\":\"Light & Wonder stock could be winner as R&D commitment firms.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.casino.org\/news\/light-wonder-stock-could-be-propelled-by-rd-spending\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.casino.org\/news\/light-wonder-stock-could-be-propelled-by-rd-spending\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.casino.org\/news\/light-wonder-stock-could-be-propelled-by-rd-spending\/#primaryimage\",\"url\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/12\/lnw.jpg\",\"contentUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/12\/lnw.jpg\",\"width\":1920,\"height\":1080,\"caption\":\"Light & Wonder signage at a roulette table. 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