Here is our perspective on why Light & Wonder (LNW) stock merits attention as a value investment. It is presently trading approximately 32% lower than its 1-year peak and is also trading at a PS multiple that is below the average from the past 3 years.LAS VEGAS, NV - FEBRUARY 12: A bank of Chinese Panda slot machines is viewed at Caesars Palace Hotel & Casino on February 12, 2023 in Las Vegas, Nevada. Las Vegas will play host to the NFL's Super Bowl LVIII, taking place next year at the recently constructed ...

LAS VEGAS--(BUSINESS WIRE)--Light & Wonder, Inc. (NASDAQ and ASX: LNW) ("Light & Wonder,†"L&W,†"we†or the "Company†) today provided notice to The Nasdaq Stock Market LLC (the "Nasdaq†) of our intention to delist our common stock from the Nasdaq in order to transition to a sole primary listing of our common stock on the Australian Securities Exchange (the "ASX†). Consistent with our previous announcements, our decision to transition to a sole primary listing on the ASX reflects ou. ...

Core Viewpoint - Light & Wonder, Inc. is currently involved in ongoing litigation with Aristocrat, with a recent ruling from the Nevada Court favoring Aristocrat's request for discovery of mathematical models related to certain games released since 2021 [1] Group 1: Legal Proceedings - The Nevada Court granted Aristocrat's renewed motion to obtain discovery of math models for specific Light & Wonder hold and spin games [1] - This ruling follows a previous denial of a similar request by the Court [1]

Core Viewpoint - Light & Wonder (LNW) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive outlook on its earnings estimates, which significantly influence stock prices [1][3]. Earnings Estimates and Stock Price Impact - The Zacks rating system emphasizes the importance of changing earnings estimates, which are strongly correlated with near-term stock price movements [4][6]. - Rising earnings estimates for Light & Wonder suggest an improvement in the company's underlying business, likely leading to an increase in stock price [5][10]. Zacks Rating System - The Zacks Rank stock-rating system classifies stocks into five groups based on earnings estimates, with a strong historical performance, particularly for Zacks Rank 1 stocks, which have averaged a +25% annual return since 1988 [7][9]. - The upgrade of Light & Wonder to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, indicating a strong potential for market-beating returns in the near term [10]. Earnings Estimate Revisions - Light & Wonder is expected to earn $5.29 per share for the fiscal year ending December 2025, with no year-over-year change, while the Zacks Consensus Estimate has increased by 2.2% over the past three months [8].

Core Viewpoint - Light & Wonder, Inc. has appointed Rohan Gallagher as Executive Vice President, Global Chief Corporate Affairs Officer, indicating a strategic focus on enhancing its corporate governance and communication efforts [1] Group 1: Appointment Details - Rohan Gallagher will be based in Sydney in his new role [1] - The position is newly created, highlighting the company's commitment to strengthening its corporate affairs [1] Group 2: Responsibilities - Gallagher will oversee Investor Relations (IR), Environmental, Social, and Governance (ESG), Corporate Social Responsibility (CSR), and Global Communications [1]

Core Viewpoint - Light & Wonder, Inc. announced a plan to offer $1 billion in senior unsecured notes due 2033 through its subsidiary, Light and Wonder International, Inc. [1] Group 1: Offering Details - The company intends to offer $1 billion in aggregate principal amount of senior unsecured notes [1] - The offering is subject to market and other conditions [1] Group 2: Use of Proceeds - The net proceeds from the offering will be used to repay all outstanding borrowings under its revolving credit facility [1]

Core Insights - Light & Wonder, Inc. (LNW) reported modest second-quarter 2025 results, with adjusted earnings exceeding estimates while revenues fell short [1][10] Financial Performance - Net income for the quarter was $95 million or $1.11 per share, an increase from $82 million or 90 cents in the prior-year quarter, driven by lower costs [3] - Adjusted earnings were $1.58 per share, beating the Zacks Consensus Estimate by 14 cents [3] - Total revenues decreased to $809 million from $818 million year-over-year, missing the Zacks Consensus Estimate of $860 million [4] - Services revenues rose to $566 million from $526 million, while Products revenues declined to $243 million from $292 million [4] Segment Performance - Gaming revenues were $528 million, down 2% year-over-year, impacted by a 16% decline in gaming machine sales and an 11% decline in systems revenue [5] - SciPlay generated $200 million in revenues, also down 2% year-over-year, but continued to outperform the broader social casino market [5] - iGaming revenues increased by 9% year-over-year to $81 million, supported by strong growth in North America and record content launches [6] Operational Efficiency - Non-GAAP consolidated AEBITDA improved to $352 million from $330 million in the year-ago quarter, with AEBITDA margin rising to 44% from 40% [7][10] - The improvement was attributed to contributions from the acquisition of Grover and sustained margin strength across multiple verticals [7] Cash Flow and Liquidity - The company generated $106 million in cash flow from operating activities, down from $141 million in the prior-year quarter [8] - As of June 30, 2025, LNW had $136 million in cash and cash equivalents, with long-term debt amounting to $4.81 billion [8] Future Guidance - For 2025, LNW expects adjusted EBITDA in the range of $1.43-1.47 billion and adjusted NPATA projected between $550-575 million [9]

Core Insights - Light & Wonder reported revenue of $809 million for the quarter ended June 2025, a decrease of 1.1% year-over-year, with EPS at $1.58 compared to $1.42 in the same quarter last year [1] - The revenue fell short of the Zacks Consensus Estimate of $859.95 million, resulting in a surprise of -5.93%, while the EPS exceeded expectations by 9.72% [1] Financial Performance Metrics - SciPlay revenue was $200 million, below the average estimate of $211.85 million, reflecting a year-over-year decline of 2.4% [4] - Gaming revenue was reported at $528 million, compared to the estimated $576.53 million, marking a 2% decrease year-over-year [4] - iGaming revenue reached $81 million, slightly above the average estimate of $80.63 million, showing a year-over-year increase of 9.5% [4] - AEBITDA for Gaming was $280 million, lower than the estimated $294.04 million [4] - AEBITDA for Corporate and other segments was reported at -$30 million, better than the average estimate of -$37.84 million [4] - AEBITDA for iGaming was $28 million, slightly above the average estimate of $27.9 million [4] - AEBITDA for SciPlay was $74 million, exceeding the average estimate of $72.71 million [4] Stock Performance - Light & Wonder's shares have returned -11.6% over the past month, contrasting with the Zacks S&P 500 composite's increase of 0.5% [3] - The stock currently holds a Zacks Rank 2 (Buy), suggesting potential outperformance against the broader market in the near term [3]

Core Viewpoint - Light & Wonder reported quarterly earnings of $1.58 per share, exceeding the Zacks Consensus Estimate of $1.44 per share, and showing an increase from $1.42 per share a year ago, representing an earnings surprise of +9.72% [1][2] Financial Performance - The company posted revenues of $809 million for the quarter ended June 2025, which missed the Zacks Consensus Estimate by 5.93% and decreased from $818 million year-over-year [2] - Over the last four quarters, Light & Wonder has surpassed consensus EPS estimates four times but has topped consensus revenue estimates only once [2] Stock Performance and Outlook - Light & Wonder shares have increased by approximately 2.3% since the beginning of the year, compared to the S&P 500's gain of 7.1% [3] - The company's earnings outlook is crucial for assessing future stock performance, with current consensus EPS estimates at $1.61 for the coming quarter and $5.52 for the current fiscal year [4][7] Industry Context - The Gaming industry, to which Light & Wonder belongs, is currently ranked in the bottom 42% of over 250 Zacks industries, indicating potential challenges ahead [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact Light & Wonder's stock performance [5][6]

Financial Data and Key Metrics Changes - Revenue for the quarter was $809 million, including partial contributions from Grover and record revenue at iGaming, offset by modest declines at gaming and SciPlay [24] - Net income increased 16% to $95 million, driven by lower cost of revenue and operating expenses [24] - Consolidated AEBITDA for the quarter was $352 million, an increase of 7% year over year, with a margin of 44%, a 400 basis point increase compared to the prior year [25] - Adjusted NPATA per share increased 11% to $1.58 compared to $1.42 in the prior year period [26] Business Line Data and Key Metrics Changes - Gaming revenue was $528 million, with partial contributions of $21 million from Grover, and AEBITDA was $280 million, an increase of 3% with a margin of 53% [27] - SciPlay revenue was $200 million, with AEBITDA of $74 million, a 6% increase year over year, representing a margin of 37% [30] - iGaming revenue reached $81 million, a 9% increase over the prior year period, with AEBITDA increasing 17% to $28 million [32] Market Data and Key Metrics Changes - Global game sales in the quarter were $191 million, primarily due to macroeconomic uncertainty impacting the timing of game sales [28] - North American unit sales were down moderately year over year, with operator apprehension affecting swap purchases early in the quarter [12] - iGaming in the U.S. and Canada continued its strong growth trajectory with over 25% growth in GGR year over year [20] Company Strategy and Development Direction - The company announced a transition to a sole ASX listing by November 2025, aiming to consolidate liquidity and maximize shareholder value [9][10] - The integration of Grover is progressing well, with seamless onboarding and operational alignment [8] - The company is focused on expanding its charitable gaming business and investing in new markets, including Indiana [9][10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to execute with discipline and deliver a stronger growth trajectory in the second half of the year [13] - The tone from operators has trended positively, indicating improvement in the broader market [12] - Management expects third quarter year-over-year consolidated EBITDA growth to be in the low double digits, with momentum building into the fourth quarter [39] Other Important Information - The company repurchased approximately $100 million of shares during the quarter, with a total of $266 million returned in the first half of the year [36] - The company is committed to improving the quality of earnings through enhancing recurring revenue and driving further efficiency [26] - The guidance for fiscal year 2025 consolidated AEBITDA is between $1.43 billion and $1.47 billion, with approximately $65 million contribution from Grover [38] Q&A Session Summary Question: Can you walk us through the investor engagement process regarding the sole ASX listing? - Management detailed that the decision followed extensive consultation with investors and is expected to optimize shareholder value [41][42] Question: Can you provide updates on the litigation? - Management indicated that both the Nevada and Australian Federal Court cases are expected to head to trial in 2026, with recent rulings moving in the company's favor [48][49] Question: Can you explain the new guidance range and its components? - Management clarified that the guidance includes $65 million from Grover, with the base business still targeting $1.4 billion [52][53] Question: How is the integration with Grover progressing? - Management reported that integration is off to a fantastic start, with the business performing well and cultural alignment being strong [63][66] Question: What are the expectations for free cash flow improvement? - Management noted that free cash flow saw a considerable year-over-year increase when normalizing for one-off payments, indicating positive growth potential [90]