Light & Wonder (LNW) AI Stock Analysis

• Market Cap: $7.51B
• Dividend Yield: N/A
• Average Volume (3M): 1.34M
• Price to Earnings (P/E): 22.3
• Beta (1Y): 1.19
• Revenue Growth: 3.93%
• EPS Growth: 19.20%
• Country: US
• Employees: 6,800
• Sector: Consumer Cyclical
• Sector Strength: 81
• Industry: Gambling, Resorts & Casinos
• EPS (TTM): 1.11
• Shares Outstanding: 83,946,594
• 10 Day Avg. Volume: 1,053,006
• 30 Day Avg. Volume: 1,335,073
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.72
• Enterprise Value/Revenue: 4.04
• Enterprise Value/Gross Profit: 5.64
• Enterprise Value/Ebitda: 11.61
• 1Y Price Target: $113.55
• Price Target Upside: 27.37% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 12

• Rating: 62 Neutral
• Price Target: $93.00 ▲(4.32% Upside)

Light & Wonder's overall stock score is driven by strong earnings growth and strategic initiatives, despite challenges in revenue growth and high leverage. The technical indicators suggest caution, and the valuation is moderate. The strategic corporate events support long-term growth.

Positive Factors

Growth Potential

Light & Wonder's ability to capitalize on its three legacy market opportunities and its newest one – charitable gaming – reinforces confidence in the company's growth potential.

Market Positioning

The acquisition of Grover Gaming provides entry into an adjacent market that plays to its content strengths and is expected to increase market share.

Valuation

Light & Wonder shares currently trade at a discount compared to the peer average, indicating potential value for investors.

Negative Factors

Intellectual Property and Tariffs

There is limited new information on pending intellectual property litigation and efforts to mitigate tariffs, which could pose risks.

Revenue Challenges

Gaming revenue was primarily driven by decreases in Gaming machine sales of 16% and Gaming systems of 11%, reflecting cautious purchasing behavior due to global macro uncertainty.

Sales Timing

Management cited macroeconomic uncertainty, cautious purchasing behavior from operators, and delayed capital expenditures as factors impacting sales timing, particularly in N.A. and Australia.

Light & Wonder Business Overview & Revenue Model

Company Description

Light & Wonder (LNW) is a global leader in the gaming and entertainment industry, specializing in digital gaming solutions and casino management systems. The company operates across various sectors, including gaming machines, table games, and digital gaming, offering innovative products and services that enhance player experiences and optimize casino operations. LNW focuses on delivering cutting-edge technology and engaging content to both land-based and online gaming markets, positioning itself as a key player in the evolving landscape of the gaming industry.

How the Company Makes Money

Light & Wonder generates revenue through multiple streams, primarily by selling gaming machines and systems to casinos and gaming operators. The company offers a range of products including slot machines, table games, and interactive gaming solutions, which are sold or leased to clients. Additionally, LNW provides casino management systems that help operators manage gaming operations more efficiently, contributing to recurring revenue through service agreements and software licensing. The company also earns revenue from its digital gaming segment, which includes online gaming platforms and mobile applications. Strategic partnerships with various online gaming operators and platforms further enhance LNW's earnings potential, as they expand the distribution of its digital content. Furthermore, LNW benefits from the growing trend of online and mobile gaming, which has been accelerated by technological advancements and changing consumer preferences.

Light & Wonder Financial Statement Overview

Summary

Light & Wonder demonstrates strong profitability and operational efficiency, but faces challenges with declining revenue growth and high leverage. While the company effectively generates returns on equity, its financial stability could be impacted by its significant debt levels. Cash flow management is stable, though there is potential for improvement in free cash flow generation.

Income Statement

Light & Wonder shows strong profitability with a healthy gross profit margin of 71.63% and a net profit margin of 10.92% for the TTM. However, the revenue growth rate has declined by 28.1% in the TTM, indicating potential challenges in maintaining revenue levels. The EBIT and EBITDA margins are solid at 22.93% and 34.81%, respectively, reflecting efficient operational management.

Balance Sheet

The company has a high debt-to-equity ratio of 6.96, suggesting significant leverage and potential financial risk. However, the return on equity is strong at 49.57%, indicating effective use of equity to generate profits. The equity ratio is relatively low, which could be a concern for financial stability.

Cash Flow

Operating cash flow is robust with a coverage ratio of 0.87, but free cash flow has decreased by 8.9% in the TTM. The free cash flow to net income ratio is 0.44, suggesting moderate efficiency in converting net income into free cash flow. Overall, cash flow management appears stable but shows room for improvement.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	3.20B	3.19B	2.90B	2.51B	2.15B	2.72B
Gross Profit	2.29B	2.26B	2.03B	1.77B	1.54B	1.56B
EBITDA	1.11B	1.09B	898.00M	591.00M	601.00M	163.00M
Net Income	349.00M	336.00M	163.00M	-176.00M	371.00M	-569.00M
Balance Sheet
Total Assets	6.49B	5.42B	5.55B	6.01B	7.88B	7.98B
Cash, Cash Equivalents and Short-Term Investments	136.00M	196.00M	425.00M	914.00M	585.00M	928.00M
Total Debt	4.89B	3.92B	3.93B	3.95B	8.75B	9.36B
Total Liabilities	5.79B	4.79B	4.79B	4.85B	9.99B	10.51B
Stockholders Equity	702.00M	636.00M	765.00M	990.00M	-2.26B	-2.65B
Cash Flow
Free Cash Flow	266.00M	338.00M	348.00M	-597.00M	514.00M	281.00M
Operating Cash Flow	603.00M	632.00M	590.00M	-381.00M	685.00M	471.00M
Investing Cash Flow	-1.10B	-258.00M	-251.00M	6.12B	-442.00M	-173.00M
Financing Cash Flow	333.00M	-573.00M	-292.00M	-5.46B	-679.00M	463.00M

Light & Wonder Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 89.15
• 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 Negative. The current price of 89.15 is below the 20-day moving average (MA) of 89.84, below the 50-day MA of 93.29, and below the 200-day MA of 91.66, indicating a bearish trend. The MACD of -0.85 indicates Positive momentum. The RSI at 44.91 is Neutral, neither overbought nor oversold. The STOCH value of 40.27 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for LNW.

Light & Wonder Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BYD	76 Outperform	$6.93B	13.32	36.36%	0.82%	6.40%	26.09%
WYNN	68 Neutral	$12.57B	35.67	-51.73%	0.82%	-1.94%	-53.90%
MGM	65 Neutral	$9.85B	19.84	17.34%	―	0.89%	-31.56%
LNW	62 Neutral	$7.51B	22.27	46.91%	―	3.93%	19.20%
Sector *	61 Neutral	$18.02B	12.77	-0.74%	3.01%	1.30%	-13.03%
MLCO	58 Neutral	$3.75B	70.80	25.40%	―	12.51%	―
CZR	52 Neutral	$5.48B	―	-4.76%	―	-0.15%	28.05%

Light & Wonder Corporate Events

Light & Wonder Issues Statement of CHESS Depositary Interests

On August 7, 2025, Light & Wonder, Inc. provided the Australian Securities Exchange with a Statement of CHESS Depositary Interests on Issue. This announcement is part of their regulatory compliance and does not impact the company’s filings under the Securities Act of 1933 or the Exchange Act.

Light & Wonder to Delist from Nasdaq by November

On July 31, 2025, Light & Wonder‘s Board of Directors approved transitioning from a dual listing on Nasdaq and ASX to a sole primary listing on the ASX, expecting to delist from Nasdaq by November 2025. This strategic move aligns with their long-term growth plans and shareholder interests. The company reported strong second-quarter results for 2025, with a 16% increase in net income and a 7% rise in consolidated AEBITDA, despite a slight revenue decrease. Light & Wonder completed the Grover acquisition, adding over 600 units since February 2025, and returned $266 million to shareholders through share repurchases in the first half of 2025. The company also increased its share repurchase program from $1.0 billion to $1.5 billion, reflecting confidence in its financial outlook.

Light & Wonder Adjusts Capital Structure with CDI Changes

On July 8, 2025, Light & Wonder, Inc. announced a new statement of CHESS Depositary Interests (CDIs) on issue to the Australian Securities Exchange. The report indicated a net transfer of securities between CDIs and common stock, with a decrease of 1,623,749 CDIs and an increase of 1,638,583 common shares, reflecting operational adjustments in the company’s capital structure.

Light & Wonder Announces Executive Leadership Transition

On June 16, 2025, Light & Wonder, Inc. announced the upcoming retirement of James Sottile, its Executive Vice President, Chief Legal Officer, and Corporate Secretary, effective December 31, 2025. Susan Dawson, currently the Senior Vice President and Deputy General Counsel, will succeed him. To ensure a smooth transition, Sottile will provide consulting services for one year following his retirement. The company has amended Sottile’s employment agreement to extend his employment through the end of 2025 and entered into a consulting agreement effective January 1, 2026, offering him a monthly fee for his services.

Light & Wonder Holds Annual Stockholders Meeting

On June 10, 2025, Light & Wonder held its annual meeting of stockholders where key decisions were made, including the election of board members, approval of executive compensation, amendment of the 2003 Plan, and ratification of Deloitte & Touche LLP as the independent auditor for 2025. Additionally, on June 6, 2025, the company provided the Australian Securities Exchange with a Statement of CHESS Depositary Interests, reflecting changes in the number of CDIs and common stock due to transfers and share repurchase activities.