Tag Archives: International Game Technology

Business, Finance, Occupation & Industry

These Gambling Stocks Can Pay Off

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By Selena Maranjian, The Motley Fool

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Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you’d like to add some gambling-oriented stocks to your portfolio, the Market Vectors Gaming ETF could save you a lot of trouble. Instead of trying to figure out which companies will perform best, you can use this ETF to invest in lots of them simultaneously.

The basics
ETFs often sport lower expense ratios than their mutual fund cousins. The Market Vectors ETF‘s expense ratio — its annual fee — is a relatively low 0.65%. The fund is very small, too, so if you’re thinking of buying, beware of possibly large spreads between its bid and ask prices. Consider using a limit order if you want to buy in.

This ETF has performed reasonably, beating the world market over the past three and five years. As with most investments, of course, we can’t expect outstanding performances in every quarter or year. Investors with conviction need to wait for their holdings to deliver.

Why gambling?
No matter whether you approve or don’t, casinos and gambling seem to be here to stay, and the games they offer are designed to make gamblers lose, overall, while the house wins. Not all casino companies are the same, though, so you should choose carefully, or invest in a big bunch via a fund such as this one. Note, though, that the traditional gambling industry is being threatened by the rise of online gambling.

More than a handful of gambling-focused companies had strong performances over the past year. Melco Crown Entertainment surged 62%, and is near its 52-week high. Thus, with a forward P/E now above 21, it’s priced for perfection. Its City of Dreams casino on Cotai has been performing well in a great location, and its projects under way include one in the Philippines.

Las Vegas Sands gained 2%, and recently yielded 2.5%. It’s also looking richly valued. The company seems to have violated some international corruption laws, though that might not be that big a problem. It’s profitable, and its free cash flow has been growing in recent years. With properties in Las Vegas not performing as well as in the past, this company and many of its peers are looking to Asia for their future growth.

Other companies didn’t do as well last year, but could see their fortunes change in the coming years. MGM Resorts shed 10%, facing some tough headwinds that include a massive and growing debt burden. It’s pinning a lot of hope on a Cotai casino under construction, but that isn’t scheduled to open until 2016.

Another good way to profit off of gambling’s growth is to invest in the companies that equip the casinos, such as International Game Technology . Down about 1% over the past year, it recently upped its dividend by 14%, and yields about 1.9%. Better …read more

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Scientific Games Earnings: An Early Look

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By Dan Caplinger, The Motley Fool

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Earnings season is winding down, with most companies already having reported their quarterly results. But there are still some companies left to report, and Scientific Games is about to release its quarterly earnings report. The key to making smart investment decisions with stocks releasing their quarter reports is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed kneejerk reaction to news that turns out to be exactly the wrong move.

Scientific Games isn’t a casino company, but it’s intimately connected to the gambling industry, helping to create lottery games for state lotteries as well as slot machines and other gaming machines for industry players. Let’s take an early look at what’s been happening with Scientific Games over the past quarter, and what we’re likely to see in its quarterly report on Monday.

Stats on Scientific Games

 

  

Analyst EPS Estimate

$0.05

Year-Ago EPS

($0.09)

Revenue Estimate

$237 million

Change From Year-Ago Revenue

(0.8%)

Earnings Beats in Past 4 Quarters

0

Source: Yahoo! Finance.

Will Scientific Games win big this quarter?
Analysts have been slightly pessimistic about Scientific Games over the past few months, cutting their consensus on earnings per share by a penny for the just-ended quarter, and by $0.02 for full-year 2013. The stock, though, has posted modest gains, rising about 7% since early December.

The big news for Scientific Games came in late January, when the company agreed to buy out rival WMS Industries for $1.5 billion in cash. Scientific Games hopes that the merger will help both businesses boost their profit margins, which have been extremely low recently. Yet, paying more than a 50% premium to where WMS traded before the announcement, Scientific Games will need the transaction to pay off in order to justify the high cost.

But the bigger challenge that Scientific Games faces is staying relevant as the push toward online gaming picks up steam. Already, International Game Technology and Bally Technologies have gotten online gaming licenses in Nevada and, with the recent authorization of a decade-long trial period for online gaming in New Jersey, Caesars Entertainment and Boyd Gaming will likely be looking to get into the space, as well. If Scientific Games can provide the infrastructure for casino companies’ online-gaming efforts, then it could be a huge opportunity; but otherwise, Scientific Games could get left out of the trend.

In its quarterly report, watch for further discussion about the status of the WMS merger, and how the unified company expects to proceed going forward. In a rapidly evolving gaming industry, Scientific Games needs to demonstrate that it’s keeping up with the times in order to avoid getting left behind.

The best investing approach is to choose great companies and stick with them for the …read more
Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

IGT Raises Dividend By 14%

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By Eric Volkman, The Motley Fool

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International Game Technology has announced a raise in its quarterly dividend. For its first payout of 2013, the company will disburse $0.08 per share of its common stock on April 5 to shareholders of record as of March 21.

That marks a 14% over the previous dividend, which was $0.07 handed out last December. Before that, the company had paid $0.06 in every quarter since March 2009.

IGT pointed out that with the just-announced distribution, it has paid dividends for 40 straight quarters.

The new dividend annualizes to $0.32 per share. That yields 1.9% at the company’s current stock price of $16.51

The article IGT Raises Dividend By 14% originally appeared on Fool.com.

Fool contributor Eric Volkman and The Motley Fool have no position in International Game Technology. Try any of our Foolish newsletter services free for 30 days. We Fools don’t all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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Source: FULL ARTICLE at DailyFinance