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Is it too late to buy Aristocrat Leisure Limited (ASX:ALL) shares?

One of the best performers on the Australian share market over the last 12 months has been the Aristocrat Leisure Limited (ASX: ALL) share price.

During this time the gaming technology company’s shares have climbed a sizeable 35%.

Is it too late to buy Aristocrat Leisure shares?

I don’t believe it is. I think that Aristocrat Leisure is one of the best-priced growth shares on the market that offers a compelling risk/reward to growth investors. Especially given the enormous promise of its Digital segment and the strength of its core business.

I’m not the only one that is bullish on the company. A note out of Goldman Sachs this morning reveals that the broker has retained its conviction buy rating and $33.10 price target on the company’s shares.

Goldman believes Aristocrat Leisure is well placed given its increasing exposure to the US$138 billion games market, which has been growing at a double digit rate for over a decade, according to a recent New Zoo report.

In addition to this, the broker expects competition from slot manufacturers to be relatively benign, meaning the company’s fundamental outlook remains very robust.

Looking ahead to its upcoming full year results, Goldman has forecast Aristocrat Leisure growing earnings per share by 40% to $1.19 in FY 2018. After which, the broker expects the company to see earnings per share rise a further 26% in FY 2019 to $1.50.

This means that the gaming technology company’s shares are currently trading at 24x estimated full year earnings or just 19x estimated FY 2019 earnings.

I think this makes its shares great value considering its current growth profile and a top alternative to exorbitantly priced tech shares such as Altium Limited (ASX: ALU) and Appen Ltd (ASX: APX). In light of this, I would suggest investors consider snapping up shares on today’s share price weakness.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of Altium and Appen Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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