International Game Technology PLC (IGT) May Still Has Much Potential to Offer

International Game Technology PLC (NYSE:IGT) has been upgraded by SunTrust, which now rates the stock as Buy versus Hold prior rating, according to a note issued on January 09. Analysts at Susquehanna, started covering the stock on December 07 with a Positive rating. Analysts at Societe Generale, made their first call about the stock on October 17, recommending it is Buy. Jefferies, released new analyst coverage on February 20, calling the stock is Buy.

IGT stock rose 0.08% in recent trade and currently has a stock-market value of $2.81B. The shares finished at $13.27, after trading as low as $13.13 earlier in the session. It hit an intraday high Thursday at $13.46. Trading activity significantly improved as the volume at ready counter increased to 4,369,554 shares versus 3,930,880 in average daily trading volume over the past 20 days. So far this year, the volume has averaged about 3,491,322 shares. The stock is now 0.53% above against its bear-market low of $13.2 on March 14, 2019. It has retreated -133.61% since it’s 52-week high of $31 reached in May. Now the market price is down -55.65% on the year and down -9.3% YTD.

Wall Street’s most bullish International Game Technology PLC (NYSE:IGT) analysts are predicting the share price to blow past $29 per share during the next 12 months. The current median share price forecast by them is $20.5, suggesting that the stock could increase 54.48% in that time frame. The average price target of $21.94 calls for a nearly 65.34% increase in the stock price.

International Game Technology PLC (IGT)’s 50 day simple moving average (SMA 50) price is $15.91 and its 200-day simple moving average (SMA 200) price is $19.03. The company’s stock currently has a total float of 98.98M shares. Its weekly volatility is hovering around 3.9% and felt 3.52% volatility in price over a month. On the upside, the share price will test short term resistance at around $13.44. On a downside, the stock is likely to find some support, which begins at $13.11. The failure to get near-term support could push it to $12.96.

When looking at valuations, International Game Technology PLC (IGT) has a pricey P/E of 55.52x as compared to industry average of 16.39x. Moreover, it trades for 8.97 times the next 12 months of expected earnings. Also, it is trading at rather expensive levels at just over 1x price/book and 0.57x price/sales. Compared to others, International Game Technology PLC is in a different league with regards to profitability, having net margins of -13.6%. To put some perspective around this, the industry’s average net margin is 19.18%. IGT’s ROE is -30.8%, which is also considerably worse than the industry’s ROE of 19.8%. It’s also very liquid in the near term, with a current ratio of 1. The stock has a debt/capital of 2.96.

Shares of IGT have dropped -22.3% since the company’s most recent earnings report. Over the past 12 fiscal quarters, International Game Technology PLC (NYSE:IGT) has topped consensus earnings estimates in 6 quarters (50%), missed earnings in 5 quarters (41%), whereas at 1 occasion EPS met analyst expectations. IGT last reported earnings that receded expectations. The company raked in $0.24 per share, -99.27% change on the same period last year. That was worse than consensus for $0.36. Revenue for the recent quarter stood at $1.27 billion, down -6% on last year and below the $1.27 billion predicted by analysts. For this quarter, Wall Street analysts forecast revenue in a range of $1.14 billion to $1.21 billion, which should be compared with $1.19 billion generated last year. EPS is seen in a range of $0.17 to $0.43, against the $0.31 reported a year ago.