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Light & Wonder
(OTC:LNWO)
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Rating:73Outperform
Price Target:
$87.00
▼(-5.95% Downside)
Action:Upgraded
Date:08/08/26
LNWO scores 73 primarily on strong financial performance (high operating margins and improved free cash flow) and supportive technical momentum (price above key moving averages with positive MACD). The score is tempered by only moderate valuation attractiveness (P/E ~27) and risk factors highlighted on the call, including SciPlay revenue pressure and leverage still above target despite a clear deleveraging plan.
Positive Factors
Recurring revenue mix
A growing recurring-revenue base makes performance less dependent on individual hardware sales and contract timing. With recurring sources representing about 70% of quarterly revenue, Light & Wonder has greater revenue visibility, supports margin durability, and can compound value from its installed content and systems base.
Negative Factors
SciPlay revenue pressure
SciPlay’s declining revenue and EBITDA expose a weakness in the digital portfolio, particularly where user metrics and acquisition economics are pressured by competition. Continued industry softness could restrain consolidated growth and require disciplined investment before this segment contributes more consistently.
Read all positive and negative factors
Positive Factors
Negative Factors
Recurring revenue mix
A growing recurring-revenue base makes performance less dependent on individual hardware sales and contract timing. With recurring sources representing about 70% of quarterly revenue, Light & Wonder has greater revenue visibility, supports margin durability, and can compound value from its installed content and systems base.
Read all positive factors
Light & Wonder (LNWO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$6.97B
Dividend YieldN/A
Average Volume (3M)15.36K
Price to Earnings (P/E)26.9
Beta (1Y)1.05
Revenue Growth4.75%
EPS Growth-16.13%
CountryUS
Employees6,800
SectorConsumer Cyclical
Sector Strength84
IndustryGambling, Resorts & Casinos
Share Statistics
EPS (TTM)3.40
Shares Outstanding77,049,180
10 Day Avg. Volume14,532
30 Day Avg. Volume15,360
Financial Highlights & Ratios
PEG Ratio-2.60
Price to Book (P/B)34.92
Price to Sales (P/S)2.58
P/FCF Ratio17.68
Enterprise Value/Market Cap1.58
Enterprise Value/Revenue3.29
Enterprise Value/Gross Profit4.84
Enterprise Value/Ebitda9.82
Forecast
1Y Price Target
$127.00Price Target Upside37.30% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)7.61
Revenue Forecast (FY)$3.39B
Light & Wonder Business Overview & Revenue Model
Company Description
Light & Wonder, Inc. is a global entertainment technology company, delivering gaming experiences across multiple platforms in the U.S. and worldwide. Its operations are structured into three main divisions: Gaming, SciPlay, and iGaming. The Gaming...
How the Company Makes Money
Light & Wonder makes money primarily by creating and monetizing gaming content and the technology used to deliver it across casino floors and digital channels. Key revenue streams generally include: (1) Land-based gaming machine sales: generating ...
Light & Wonder Earnings Call Summary
Earnings Call Date:Aug 04, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 04, 2026
Earnings Call Sentiment Positive
The call presented a predominantly positive operational and financial picture: strong margin expansion, robust cash flow growth and improving recurring revenue mix supported significant earnings and per-share growth. Core gaming and iGaming segments showed clear momentum and Grover is scaling post-acquisition. Notable weaknesses include SciPlay revenue decline and industry-driven UA headwinds, modest overall revenue growth (2% YoY), and leverage that remains above management targets. Management has a clear deleveraging plan, expects H2 weighted sales and reiterated mid- to high single-digit consolidated AEBITDA growth for 2026. On balance, the highlights substantially outweigh the lowlights given sizable margin, cash flow and profitability improvements alongside a credible balance-sheet strategy.Positive Updates
Strong Profitability and EPS Growth
Consolidated AEBITDA of $383 million, up 9% year-over-year; Adjusted NPATA grew 16% to $156 million; EPSa (adjusted NPATA per share) $1.99, up 26% year-over-year; net income $120 million, up 26% and net income per share $1.53, up 38%.
Negative Updates
SciPlay Revenue Decline and Industry Headwinds
SciPlay revenue declined 9% year-over-year to $182 million and EBITDA decreased 3% to $72 million; broader social casino industry softness and competition from sweepstakes pressured user metrics and UA economics.
Read all updates
Q2-2026 Updates
Positive
Negative
Strong Profitability and EPS Growth
Consolidated AEBITDA of $383 million, up 9% year-over-year; Adjusted NPATA grew 16% to $156 million; EPSa (adjusted NPATA per share) $1.99, up 26% year-over-year; net income $120 million, up 26% and net income per share $1.53, up 38%.
Read all positive updates
Company Guidance
Light & Wonder reaffirmed 2026 guidance targeting mid‑ to high‑single‑digit consolidated AEBITDA growth with a back‑half weighted, sequentially improving earnings profile; Q3 global game sales are expected to run ~8,500–9,000 units with sales accelerating into Q4, North American average daily revenue per unit to grow year‑over‑year roughly in line with CPI, and annual R&D+CapEx targeted at ~17% of revenue (15–20% range); from a capital perspective they aim to reach the midpoint of their net‑debt leverage range by year‑end 2026 and go below 3.0x in H1 2027 en route to an investment‑grade profile, will keep corporate costs in the mid‑to‑high $30M per quarter range, pursue buybacks opportunistically but materially below H1’s ~ $150M pace (Q2 buybacks = $134M; $180M remaining), and will factor U.K. tax changes, U.S. tariffs, AI and Grover investments and legal costs into their deployment of capital.Light & Wonder Financial Statement Overview
Summary
Income Statement
76
Positive
Balance Sheet
58
Neutral
Cash Flow
72
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 3.35B | 3.31B | 3.19B | 2.90B | 2.51B | 2.15B |
| Gross Profit | 2.27B | 2.02B | 2.26B | 2.03B | 1.77B | 1.54B |
| EBITDA | 1.12B | 1.08B | 1.07B | 898.00M | 584.00M | 582.00M |
| Net Income | 271.00M | 276.00M | 336.00M | 163.00M | 3.67B | 371.00M |
Balance Sheet | ||||||
| Total Assets | 6.36B | 6.46B | 5.42B | 5.55B | 6.01B | 7.88B |
| Cash, Cash Equivalents and Short-Term Investments | 148.00M | 167.00M | 196.00M | 425.00M | 914.00M | 585.00M |
| Total Debt | 5.16B | 5.24B | 3.92B | 3.93B | 3.95B | 8.75B |
| Total Liabilities | 6.06B | 6.22B | 4.79B | 4.79B | 4.85B | 9.99B |
| Stockholders Equity | 302.00M | 245.00M | 636.00M | 765.00M | 990.00M | -2.26B |
Cash Flow | ||||||
| Free Cash Flow | 554.00M | 484.00M | 338.00M | 348.00M | -597.00M | 514.00M |
| Operating Cash Flow | 883.00M | 794.00M | 632.00M | 590.00M | -381.00M | 685.00M |
| Investing Cash Flow | -328.00M | -1.17B | -258.00M | -251.00M | 6.12B | -442.00M |
| Financing Cash Flow | -579.00M | 321.00M | -577.00M | -788.00M | -5.46B | -679.00M |
Light & Wonder Technical Analysis
Positive
92.50
Price Trends
84.80
Positive
83.50
Positive
87.81
Positive
Market Momentum
2.16
Negative
64.75
Neutral
84.23
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LNWO, the sentiment is Positive. The current price of 92.5 is above the 20-day moving average (MA) of 82.21, above the 50-day MA of 84.80, and above the 200-day MA of 87.81, indicating a bullish trend. The MACD of 2.16 indicates Negative momentum. The RSI at 64.75 is Neutral, neither overbought nor oversold. The STOCH value of 84.23 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for LNWO.
Light & Wonder Risk Analysis
Light & Wonder disclosed 51 risk factors in its most recent earnings report. Light & Wonder reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Light & Wonder Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $5.34B | 14.40 | 45.70% | 4.19% | 17.33% | 176.52% | |
73 Outperform | $6.97B | 26.87 | 68.56% | ― | 4.75% | -16.13% | |
67 Neutral | $3.51B | 44.05 | 31.76% | ― | 34.29% | 14.69% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
56 Neutral | $18.06B | -60.27 | -26.30% | ― | 15.03% | 46.89% | |
53 Neutral | $94.36M | -11.30 | 70.68% | ― | -6.73% | -114.46% | |
52 Neutral | $1.97B | -2.32 | -48.48% | 5.71% | 6.14% | -1168.84% |
* Consumer Cyclical Sector Average
LNWO
Light & Wonder
91.10
17.61
23.96%
PENN
PENN Entertainment
14.72
-1.89
-11.38%
INSE
Inspired Entertainment
3.58
-4.10
-53.39%
DKNG
DraftKings
20.30
-10.35
-33.77%
RSI
Rush Street Interactive
15.13
-3.04
-16.73%
SGHC
Super Group (SGHC)
10.51
-0.08
-0.75%
Light & Wonder Corporate Events
Regulatory Filings and Compliance
Light & Wonder directors to exercise vested options
Neutral
Aug 17, 2026
On August 17, 2026 U.S. time (August 18, 2026 Australia time), Light Wonder announced that Chair Jamie Odell and Vice Chair Toni Korsanos had notified the company of their intention to exercise a portion of their vested options on a cashless basi...
Business Operations and StrategyStock BuybackFinancial Disclosures
Light & Wonder Sets Date for Q2 2026 Results
Positive
Jul 13, 2026
Light Wonder said on July 13, 2026, that it will publish its second‑quarter 2026 results after U.S. markets close on August 4, 2026, ahead of the ASX open on August 5, 2026. Management will discuss the numbers and broader business trends on...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.