IGT Drags Down Sector
(IGT article updated with stock prices.)
NEW YORK (
) --
International Game Technologies
(IGT) - Get Report
saw its rating cut by Goldman Sachs on Monday, on pessimism in the regional gaming market and product replacement.
The news sent shares sinking 3.2% to $19.99 in afternoon trading and dragged down shares of other gaming technology makers.
Bally Technologies
(BYI)
is off 0.4% to $43.90,
WMS Industries
is falling 0.7% to $40.80 and
Suffle Master
>
(SHFL)
is dropping 4.3% to $8.64.
The brokerage firm lowered its rating to neutral from buy and cut its price target to $23 from $26.
"We are increasingly concerned that regional markets will remain weak, and given that 60% to 65% of IGT's earnings come from gaming operations, this could be a drag on results," analyst Steven Kent wrote in a note.
Goldman is also concerned about IGT's comments regarding its "limited visibility" in product replacement cycle.
Last week the slot machine maker reported a
20% gain in first-quarter earnings
, surpassing Wall Street's estimates.
The earning season for casino operators starts next week with
Penn National Gaming
(PENN) - Get Report
, and could give a better picture on how casinos will buy gaming technologies in 2010.
-
Reported by Jeanine Poggi in New York.
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