5 Casino Services Stocks to Play
4. Bally Technologies designs, manufactures, operates, and distributes advanced technology-based gaming devices and systems worldwide. Bally's product line includes reel-spinning slot machines, video slot machines, wide-area progressives, and Class II, lottery, and central determination games and platforms.
For second quarter of 2011, total revenue was $182.7 million. Gaming operations contributed $77.1 million to total revenue, the highest ever achieved. Moreover, average selling price of new units increased by 7% to $15,244, driven by sales of its pro-series with Alpha 2 technology. At the end of Dec. 2010, gaming monitoring units installed base stood at 392,000 and systems managed cashless games stood at 327,000, representing a year-on-year increase of 7.4% and 4.5%, respectively.
The company recently announced plans to acquire Sightline Payments, a provider of innovative payment solutions. The strategic investment would enable Bally to launch cashless gaming products which it believes can change the gaming payments industry. Bally also announced DRGT Europe as its distributor for slot machines and related equipment in Belgium.Going forward, the company expects improvement in replacement demand as well as jurisdictional expansions during 2011. Furthermore, Bally forecasts diluted EPS of $2-$2.15 on annual revenue of $205-$215 million. Of the nineteen analysts covering the stock, 68% recommend a buy and 26% rate it a hold. On average, analysts estimate an upside of 25% to $46.63 in value from current levels.
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