Deutsche Bank says casinos liking IGT current slots

Oct 11, 2018 Newsdesk Industry Talk, Latest News, Top of the deck, World  

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The United States-based stockbroking arm of Deutsche Bank AG says casino operators have expressed positive opinions about the slot machine products currently offered by International Game Technology Plc (IGT).

Deutsche Bank Securities Inc issued on Wednesday a note saying that before a recent casino industry trade show its researchers met representatives of casino operators and discussed IGT slot machines.

“The feedback on IGT’s for-sale product was very favourable,” the memo said.

“Operators noted… specifically the product coming from the legacy GTech studios, has played very well, which has helped IGT drive increasing ship share in casino-operator-purchased video product in 2018,” stated analysts Carlo Santarelli and Danny Valoy.

Italy-based GTech SpA merged with the legacy U.S.-based IGT entity in 2015, taking the latter’s name, although GTech was the suitor in that deal.

Prior to the deal, a number of industry analysts had questioned the direction of the legacy IGT’s slot machine development programme.

Deutsche Bank’s Wednesday memo quoted the current IGT entity as saying it was using feedback from testing of its core products to help improve the development of what it terms its premium products.

The brokerage noted IGT management also said it had received favourable feedback from customers about its systems technology add-ons.

“IGT believes its ability to provide scalable solutions for smaller-to-medium-size casino operators represents an incremental opportunity to address a previously underserved customer base,” the note says.

Deutsche Bank cited IGT executives as indicating they expected to sell 6,000 slot machines in Sweden, that the company results for the fourth quarter of this year may reflect the sale of 4,000 of those machines. The group’s results for the succeeding quarter would reflect the sale of the rest.

Management expected a cycle of machine replacements in the Canada market – involving 35,000 machines – to begin next year and continue until 2021, the note said.

Deutsche Bank has a “buy” recommendation for New York-listed IGT stock and a target price of US$35 a share.

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