Accel Entertainment (ACEL) AI Stock Analysis

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Accel Entertainment

(NYSE:ACEL)

Rating:76Outperform

Price Target:

$12.50

▲( 11.41% Upside)

Accel Entertainment's stock is rated well due to its strong financial performance, highlighted by consistent revenue growth and robust cash flows, which are supported by positive technical indicators. The earnings call underscores operational successes and strategic expansions, despite minor setbacks. The valuation is moderate, reflecting a balanced risk-reward profile.

Accel Entertainment (ACEL) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$949.68M

Dividend YieldN/A

Average Volume (3M)412.49K

Price to Earnings (P/E)22.6

Beta (1Y)0.81

Revenue Growth6.28%

EPS Growth-1.99%

CountryUS

Employees1,500

SectorConsumer Cyclical

Sector Strength75

IndustryGambling, Resorts & Casinos

Share Statistics

EPS (TTM)0.23

Shares Outstanding84,641,290

10 Day Avg. Volume271,717

30 Day Avg. Volume412,485

Financial Highlights & Ratios

PEG Ratio1.23

Price to Book (P/B)3.84

Price to Sales (P/S)0.00

P/FCF Ratio15.17

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$15.00

Price Target Upside33.69% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering1

Accel Entertainment Business Overview & Revenue Model

Company DescriptionAccel Entertainment, Inc., together with its subsidiaries, operates as a distributed gaming operator in the United States. It is involved in the installation, maintenance, and operation of gaming terminals; redemption devices that disburse winnings and contain automated teller machine (ATM) functionality; and other amusement devices in authorized non-casino locations, such as restaurants, bars, taverns, convenience stores, liquor stores, truck stops, and grocery stores. The company also provides licensed establishment partners gaming solutions that appeal to players who patronize those businesses. In addition, it operates stand-alone ATMs in gaming and non-gaming locations, as well as amusement devices, including jukeboxes, dartboards, pool tables, pinball machines, and other related entertainment equipment. As of December 31, 2021, the company operated 13,639 video gaming terminals across 2,584 locations in Illinois. Accel Entertainment, Inc. is headquartered in Burr Ridge, Illinois.

How the Company Makes MoneyAccel Entertainment makes money through a revenue-sharing model with its partner establishments where video gaming terminals (VGTs) are installed. These VGTs generate income from players, and the revenue is split between Accel, the partnering venue, and the state or local government. The company earns a percentage of the net terminal income, which is the total amount wagered minus the winnings paid out to players. Accel also benefits from economies of scale by managing a large network of gaming terminals, which helps optimize operational efficiencies and maximize profitability. Additionally, Accel Entertainment's growth is supported by strategic partnerships and agreements with various establishments, expanding its footprint in the distributed gaming market.

Accel Entertainment Financial Statement Overview

Summary

Accel Entertainment demonstrates strong financial health with consistent revenue and profit growth, improving leverage metrics, and robust cash flow generation. While the balance sheet could benefit from higher equity levels, the company maintains a solid financial footing with efficient operations and cash management.

Income Statement

Very Positive

Accel Entertainment shows strong revenue growth and improved profitability. The TTM revenue growth rate of 1.79% and consistent gross profit margin near 32% suggest stable operations. The net profit margin also improved to 3.39% in TTM, indicating better cost management.

Balance Sheet

Positive

The balance sheet reflects moderate leverage with a debt-to-equity ratio of 0.13 in TTM, down from previous years, which is favorable. However, the equity ratio stands at 24.74%, reflecting a decent but not high level of equity cushioning. ROE improved to 16.39% in TTM, showing efficient use of equity capital.

Cash Flow

Positive

Free cash flow growth was robust at 18.05% in TTM, indicating strong cash generation capabilities. The operating cash flow to net income ratio of 3.23 in TTM suggests efficient cash conversion from profits. Free cash flow to net income ratio is 1.52, affirming solid cash retention.

TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
1.25B	1.23B	1.17B	969.80M	734.71M	316.35M
	Gross Profit
405.42M	378.60M	353.23M	298.90M	240.68M	105.27M
	EBIT
91.28M	90.88M	107.41M	96.86M	70.19M	-24.68M
	EBITDA
134.86M	133.56M	157.99M	163.18M	105.95M	39.96M
	Net Income Common Stockholders
42.48M	35.25M	45.60M	74.10M	31.56M	-12.98M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
136.40M	281.31M	261.61M	256.18M	230.85M	134.45M
	Total Assets
509.32M	1.05B	912.89M	862.77M	616.07M	560.24M
	Total Debt
349.69M	595.38M	542.57M	542.03M	341.52M	340.14M
	Net Debt
224.29M	314.07M	280.96M	317.92M	142.74M	205.69M
	Total Liabilities
423.79M	789.09M	714.49M	684.18M	457.61M	432.36M
	Stockholders Equity
85.53M	255.03M	198.40M	178.59M	158.46M	127.88M
Cash Flow		Free Cash Flow
64.53M	54.65M	50.79M	60.62M	81.00M	-29.47M
	Operating Cash Flow
137.20M	121.19M	132.53M	108.00M	110.75M	-3.71M
	Investing Cash Flow
-124.44M	-124.15M	-59.79M	-189.26M	-34.54M	-61.44M
	Financing Cash Flow
5.26M	22.65M	-35.24M	106.59M	-11.88M	74.19M

Accel Entertainment Technical Analysis

Technical Analysis Sentiment

Positive

Last Price11.22

Price Trends

50DMA

10.75

Positive

100DMA

10.92

Positive

200DMA

11.17

Positive

Market Momentum

MACD

0.15

Positive

RSI

50.42

Neutral

STOCH

13.70

Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ACEL, the sentiment is Positive. The current price of 11.22 is below the 20-day moving average (MA) of 11.26, above the 50-day MA of 10.75, and above the 200-day MA of 11.17, indicating a neutral trend. The MACD of 0.15 indicates Positive momentum. The RSI at 50.42 is Neutral, neither overbought nor oversold. The STOCH value of 13.70 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ACEL.

Accel Entertainment Risk Analysis

Accel Entertainment disclosed 37 risk factors in its most recent earnings report. Accel Entertainment reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 2 New Risks

Our distributed gaming industry operations are located in markets where terminal revenue splits are either statutorily determined or negotiated. For our markets with negotiated splits, our revenue could be impacted by contract negotiations and our revenue in markets with statutory splits could decline if such jurisdictions move towards negotiated splits or reduce our statutory split. Q4, 2024

Our expansion into casino operations and horse racing may not be successful. Q4, 2024

Accel Entertainment Peers Comparison

Overall Rating

UnderperformOutperform

Sector (62)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ACEL	76 Outperform	$949.68M	22.65	18.42%	―	6.28%	-1.99%
MCRI	76 Outperform	$1.51B	16.14	18.31%	1.46%	3.84%	19.95%
AGS	73 Outperform	$508.44M	10.65	49.64%	―	6.60%	778.46%
EVRI	62 Neutral	$1.22B	86.98	5.81%	―	-6.41%	-75.66%
Sector *	62 Neutral	$6.84B	11.23	3.09%	3.95%	2.66%	-25.23%
GDEN	60 Neutral	$742.83M	71.85	2.18%	3.56%	-31.14%	-95.88%
BALY	49 Neutral	$741.76M	―	-65.87%	―	-1.93%	15.16%

* Consumer Cyclical Sector Average

Performance Comparison

ACEL

Accel Entertainment

11.22

1.63

17.00%

EVRI

Everi Holdings

14.10

7.40

110.45%

MCRI

Monarch Casino & Resort

81.92

17.29

26.75%

GDEN

Golden Entertainment

28.10

-0.16

-0.57%

AGS

Playags

12.25

0.78

6.80%

BALY

Bally's Corporation

10.52

-11.55

-52.33%

Accel Entertainment Earnings Call Summary

Earnings Call Date:May 05, 2025

(Q1-2025)

% Change Since: 4.37%|

Next Earnings Date:Jul 30, 2025

Earnings Call Sentiment Positive

The earnings call for Accel Entertainment highlighted significant achievements, such as record revenue and successful expansions, despite facing some challenges like a revenue decline in Nevada and a key leadership change. The company's strong performance in various markets and successful integration of acquisitions suggest a positive outlook.

Q1-2025 Updates

Positive Updates

Record-Breaking Quarterly Revenue

Accel Entertainment reported total revenue of $344 million for Q1 2025, marking its highest quarterly revenue since going public. This represents a 7% year-over-year growth.

Strong Adjusted EBITDA Growth

The company achieved an adjusted EBITDA of $50 million, reflecting a 7% year-over-year increase.

Successful Fairmount Park Casino Opening

Fairmount Park Casino opened on April 18, ahead of schedule and under budget, contributing to the company's growth and marking a significant milestone as the first racino in Illinois.

Growth in Key Markets

Illinois and Montana saw revenue growth of 4% and 8% year-over-year respectively. Nebraska and Georgia experienced strong double-digit revenue growth, with Georgia's revenue per day increasing by 59.3% year-over-year.

Strategic Expansion and Acquisition

Completed the integration of recently acquired operations in Louisiana, adding 96 locations and 614 terminals, expected to drive future synergies and performance improvements.

Negative Updates

Revenue Decline in Nevada

Nevada experienced a small revenue decline in the first quarter due to the loss of a key customer from an ownership change, with revenue per day decreasing by 5.3% year-over-year.

CFO Departure

Matt Ellis, the CFO, announced his departure, effective May 9, creating a temporary leadership gap as the company searches for a permanent replacement.

Company Guidance

During the Accel Entertainment Q1 2025 earnings call, several key financial metrics and guidance were provided. The company reported a record quarterly revenue of $344 million, marking a 7% year-over-year increase, alongside an adjusted EBITDA of $50 million, also up by 7%. The growth was driven by stable revenue increases in Illinois and Montana, with 4% and 8% year-over-year growth, respectively. Nebraska and Georgia experienced double-digit growth, while Nevada faced a slight decline. The company completed integration in Louisiana, adding 96 locations and 614 terminals, and announced the opening of Fairmount Park Casino, Illinois's first racino. Looking forward, Accel projects capital expenditures for 2025 to be between $75 million and $80 million, with future normalized annual CapEx expected to return to $40 million to $45 million. The company emphasized its strategy of optimizing locations and leveraging its distributed gaming model to drive growth and improve free cash flow.

Accel Entertainment Corporate Events

Executive/Board ChangesBusiness Operations and Strategy

Accel Entertainment CFO Resignation Announced

Neutral

Apr 29, 2025

On April 29, 2025, Accel Entertainment announced the resignation of its Chief Financial Officer, Mathew Ellis, effective May 9, 2025, as he pursues other career opportunities. Mark Phelan, the company’s President of U.S. Gaming, will serve as the acting CFO while Accel searches for a permanent replacement. The transition is expected to be smooth, with Phelan’s experience and the company’s strong finance team ensuring continuity in operations. The company is focused on finding a leader who can drive growth and innovation.

Executive/Board ChangesShareholder Meetings

Accel Entertainment Expands Board with New Director

Neutral

Apr 11, 2025

On April 10, 2025, Eden Godsoe, a Class 3 director on the Board of Directors of Accel Entertainment, announced she will not stand for reelection at the company’s 2025 Annual Meeting of Stockholders, with no disagreements cited. Concurrently, Cheryl Kondra was appointed as a Class 2 director, expanding the Board from 8 to 9 members. Mrs. Kondra will serve as Chair of the Audit Committee and a member of the Compensation Committee, receiving prorated compensation and a restricted stock unit grant for her service.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.