Light & Wonder (LNW) AI Stock Analysis

• Market Cap: $7.26B
• Dividend Yield: N/A
• Average Volume (3M): 1.13M
• Price to Earnings (P/E): 23.0
• Beta (1Y): 1.20
• Revenue Growth: 7.26%
• EPS Growth: 54.83%
• Country: US
• Employees: 6,800
• Sector: Consumer Cyclical
• Sector Strength: 75
• Industry: Gambling, Resorts & Casinos
• EPS (TTM): 0.94
• Shares Outstanding: 84,378,630
• 10 Day Avg. Volume: 991,222
• 30 Day Avg. Volume: 1,126,960
• PEG Ratio: 1.63
• Price to Book (P/B): 11.28
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 25.37
• Enterprise Value/Market Cap: 1.46
• Enterprise Value/Revenue: 0.85
• Enterprise Value/Gross Profit: 4.88
• Enterprise Value/Ebitda: 2.57
• 1Y Price Target: $108.72
• Price Target Upside: 26.40% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 11

• Rating: 73 Outperform
• Price Target: $94.00 ▲( 9.29% Upside)

Light & Wonder's stock reflects strong financial performance, strategic growth initiatives, and a positive outlook from recent corporate activities. The bearish technical indicators and fair valuation metric suggest some caution, but the company’s robust EBITDA growth and strategic acquisitions present significant strengths.

Positive Factors

Competitive Position

Light & Wonder maintains the #1 ship share position in North America and Australia, highlighting its strong competitive standing.

Financial Performance

Management introduced a longer-term financial target of $2.0B in adjusted EBITDA by 2028, indicating strong growth potential.

Market Expansion

Light & Wonder's entry into the charitable gaming market through the acquisition of Grover Gaming plays to its content strengths and is expected to expand market share.

Negative Factors

Earnings Guidance

Revenue estimates for 2025 and 2026 have been lowered based on 1Q25 results and management comments.

Earnings Performance

Light & Wonder’s Q1 2025 results came in below consensus expectations, with consolidated revenue of $774M vs. $807M and AEBITDA of $311M vs. $313M.

Litigation Risks

There is little new information on Light & Wonder's pending intellectual property litigation and efforts to mitigate tariffs, which could pose risks.

Light & Wonder Business Overview & Revenue Model

Company Description

Light & Wonder, Inc. develops technology-based products and services, and related content for the gaming, lottery, social and digital gaming industries in the United States and internationally. The company's Gaming segment sells new and used gaming machines, electronic table systems, video lottery terminals, conversion game kits, and spare parts; table products, including shufflers; and perpetual licenses to proprietary table games. It also supplies game content, gaming machines; provides table game products and services to licensed gaming entities; and installs and supports casino management systems, such as ongoing hardware and software maintenance and upgrade services of customer casino management systems. The company's SciPlay segment develops and publishes digital games on mobile and web platforms. It sells virtual coins, chips, or bingo cards, which players can use to play slot games, table games, or bingo games. Its iGaming segment provides a suite of digital gaming content, including digital real-money gaming, distribution platforms, content, products, and services. This segment also offers the Open Platform System, which offers a range of reporting and administrative functions and tools providing operators control over various areas of digital gaming operations. The company also offers software design, development, licensing, maintenance, support services, and technology solutions. Light & Wonder, Inc. was incorporated in 1984 and is based in Las Vegas, Nevada.

How the Company Makes Money

Light & Wonder generates revenue through a variety of streams, primarily from the sale, lease, and licensing of gaming content and technology to casinos and gaming operators worldwide. The company earns money through its gaming machines, which are sold or leased to gaming venues, as well as through participation agreements where they share in the revenue generated by their machines on casino floors. Additionally, Light & Wonder licenses its digital gaming content to online gaming platforms, contributing to its interactive gaming revenue. The company also benefits from its lottery segment by providing lottery systems and services to governments and operators. Significant partnerships with casinos, online gaming platforms, and lottery operators further bolster its revenue, along with strategic acquisitions that expand its market reach and product offerings.

Light & Wonder Financial Statement Overview

Summary

Light & Wonder demonstrates strong revenue growth and profitability improvements, with robust operational performance reflected in its income statement. The balance sheet shows improved leverage, though the modest equity base poses potential risks. Cash flow generation is stable but could benefit from better efficiency in cash conversion. Overall, the company is on an upward trajectory with strengths in profitability and debt management, but historical volatility necessitates careful monitoring.

Income Statement

Light & Wonder has shown impressive revenue growth, with a notable increase from $2,902 million in 2023 to $3,188 million in 2024. The gross profit margin is extremely strong at 100%, indicating efficient management of production costs. Net profit margin improved significantly to 15.87% in 2024, reflecting enhanced profitability. Both EBIT and EBITDA margins are robust at 20.95% and 15.34% respectively, showcasing strong operational performance. However, historical volatility in net income, such as the negative figures in 2020 and 2022, indicates some underlying instability.

Balance Sheet

The company's debt-to-equity ratio has dramatically improved, dropping from a high leverage in prior years to 0.08 in 2024, due to decreased total debt and increased equity. The equity ratio stands at 11.73% in 2024, showing an improved but still modest position compared to liabilities. Return on Equity (ROE) has jumped to 79.56% in 2024, which is a strong indicator of shareholder value creation, yet it also suggests potential risk due to the low equity base.

Cash Flow

Free cash flow has remained stable with a slight decrease from $348 million in 2023 to $338 million in 2024, indicating steady cash generation capability. The operating cash flow to net income ratio is favorable at 1.25, demonstrating effective conversion of net income into cash. However, free cash flow to net income ratio is lower at 0.67, indicating room for improvement in cash conversion efficiency. Historical fluctuations, such as negative free cash flow in 2022, highlight potential risks.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
3.19B	2.90B	2.51B	2.15B	2.72B
	Gross Profit
2.26B	2.03B	1.77B	1.54B	1.56B
	EBIT
668.00M	518.00M	273.00M	351.00M	80.00M
	EBITDA
1.09B	898.00M	591.00M	749.00M	163.00M
	Net Income Common Stockholders
336.00M	163.00M	-176.00M	24.00M	-548.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
196.00M	425.00M	914.00M	585.00M	1.02B
	Total Assets
5.42B	5.55B	6.01B	7.88B	7.98B
	Total Debt
3.92B	3.93B	3.93B	8.73B	9.38B
	Net Debt
3.72B	3.51B	3.02B	8.14B	8.36B
	Total Liabilities
4.79B	4.79B	4.85B	9.99B	10.51B
	Stockholders Equity
636.00M	765.00M	1.16B	-2.11B	-2.52B
Cash Flow		Free Cash Flow
338.00M	348.00M	-597.00M	514.00M	281.00M
	Operating Cash Flow
632.00M	590.00M	-381.00M	685.00M	471.00M
	Investing Cash Flow
-258.00M	-251.00M	6.12B	-442.00M	-173.00M
	Financing Cash Flow
-573.00M	-292.00M	-5.46B	-679.00M	463.00M

Light & Wonder Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 86.01
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LNW, the sentiment is Neutral. The current price of 86.01 is below the 20-day moving average (MA) of 86.05, below the 50-day MA of 88.14, and below the 200-day MA of 94.82, indicating a bearish trend. The MACD of -1.03 indicates Positive momentum. The RSI at 50.88 is Neutral, neither overbought nor oversold. The STOCH value of 39.56 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for LNW.

Light & Wonder Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
LNW	73 Outperform	$7.26B	23.02	46.19%	―	7.26%	54.83%
LVS	71 Outperform	$28.12B	22.18	39.21%	2.13%	-0.09%	-13.07%
IGT	69 Neutral	$3.09B	10.63	1.33%	5.23%	-33.50%	35.81%
MGM	68 Neutral	$8.53B	14.04	21.38%	―	2.76%	-14.31%
Sector *	62 Neutral	$6.84B	11.23	3.09%	3.95%	2.66%	-25.23%
DKNG	58 Neutral	$31.20B	―	-46.78%	―	22.86%	30.40%

Light & Wonder Corporate Events

Light & Wonder Secures Loan for Grover Gaming Acquisition

On May 15, 2025, Light and Wonder International, Inc. entered into a new credit agreement with several financial institutions, securing an $800 million term loan to finance its acquisition of Grover Gaming’s charitable gaming business. The following day, the company completed the acquisition for $850 million, with an additional earn-out of up to $200 million, enhancing its position in the charitable gaming market.

The most recent analyst rating on (LNW) stock is a Buy with a $118.00 price target. To see the full list of analyst forecasts on Light & Wonder stock, see the LNW Stock Forecast page.

Light & Wonder Increases CDIs on ASX in April

On May 6, 2025, Light & Wonder, Inc. announced the submission of a Statement of CHESS Depositary Interests on Issue to the Australian Securities Exchange. The statement revealed a net increase of 5,380,921 CDIs quoted on ASX for April 2025, attributed to net transfers between CDIs and common stock, while the common stock saw a decrease due to share repurchases and other adjustments.

Light & Wonder Submits CHESS Depositary Interests Statement

On April 8, 2025, Light & Wonder, Inc. announced the submission of its Statement of CHESS Depositary Interests on Issue (Appendix 4A) to the Australian Securities Exchange, reflecting changes in its issued capital for March 2025. The report highlighted a net increase in the number of CDIs and common stock due to transfers between CDIs and common stock, share repurchases, and the vesting of restricted stock units and exercise of options, indicating active management of its equity structure.