Benchmark maintains Buy on Light & Wonder stock, target at $114

On Monday, Benchmark analysts reiterated their Buy rating for Light & Wonder (NASDAQ:LNW) with a stable price target of $114.00. The affirmation follows insights gathered from the ICE 2025 conference in Barcelona, where the company's prospects were discussed. Light & Wonder is expected to meet their Q4 guidance and is on track to reach their 2025 Adjusted EBITDA goals.

The company's strategic management of the Dragon Train situation and their investment in new games and studios have positioned them well for future growth. With a robust creative culture and ample resources, Light & Wonder continues to draw in top industry talent, further enhancing their innovative game development capabilities. The upcoming release of Huff N’ Puff Hard Hat and the anticipated launch of Dragon Train 2.0 in 2025 are set to revitalize the franchise and refocus investor attention on the company's growth potential.

Analysts predict that Light & Wonder will further optimize its cost structure, maintaining a disciplined approach to profitable growth. The company's efforts to streamline operations are expected to contribute to a more efficient financial performance. Additionally, a planned investor day in 2025 is likely to provide new medium-term guidance that could shift investor focus towards sustained EBITDA growth.

The recent pullback in share price is seen by Benchmark as an opportunistic moment for investors. The analysts' confidence in Light & Wonder is underpinned by the company's strategic initiatives and the potential for new game launches to drive future success.

In other recent news, Light & Wonder has been making noteworthy strides. The company reported a 12% year-over-year increase in Q3 2024 revenue, reaching $817 million, marking its 14th consecutive quarter of growth. The gaming segment was a significant contributor, with a 15% revenue boost primarily driven by a 38% rise in global gaming machine sales. Light & Wonder also reported a consolidated AEBITDA of $319 million and an Adjusted NPATA increase of 23% to $122 million.

Jefferies analyst recently increased the price target for Light & Wonder to $121.00 from $120.00, reiterating a Buy rating on the stock. Despite the company's shares experiencing a decline, Jefferies maintains confidence in Light & Wonder's promising prospects. The company's ongoing legal issues with a competitor are not expected to significantly impact its financials, thanks to current market dynamics.

In terms of regulatory updates, Light & Wonder recently provided information to the Australian Securities Exchange (ASX). These updates, known as Appendix 4A, are routine measures ensuring compliance with international securities regulations, and do not alter the company's financial position or reflect any significant changes to its operations.

Looking forward, Light & Wonder anticipates a low single-digit AEBITDA growth for Q4 2024 but expects to return to normalized growth in 2025. Analysts from various firms, including Jefferies, have highlighted the company's diversified portfolio, noting its leading market share in Asia and its number one ship share in the Australian market. These are the recent developments in the ongoing journey of Light & Wonder.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.