DoJ's Ruling Acts as Bliss for IGT

As reported, the ruling enables the states to allow online lottery tickets and other forms of online gambling games to its residents. The casino operators like Las Vegas Sands Corp. and MGM Resorts International stand to benefit from the ruling given their online presence, as they can now reach out to a larger clientele. Subsequently, the casino game providers including International Game Innovation and WMS Industries Inc. would as well tank in the gains by providing gambling games online, as demanded.

Boon for IGT

This ruling comes as a boon for IGT, which expects half of the projected earnings to come from core sector and the other half from the emerging initiatives like interactive and cloud computing.

The recent acquisition of Entraction Holding AB will as well have a positive impact on the top line of IGT from 2013-2014. The acquisition has as well provided an exposure to IGT in the online B2B for bingo, poker and sports gambling. Online earnings forms only 5% of the revenue component and company expects to increase that proportion going forward. Expectedly, this DoJ ruling would furthermore boost the online revenues in the end.

Further, we believe that international expansion, an impressive product portfolio, cost-cutting initiatives, reducing dependence on the domestic machine replacement cycle, new contract wins, solid free cash flow and strong growth from the interactive business will drive growth over the long term.