How is the Aristocrat (ASX:ALL) share price hitting record highs during lockdowns?

Let's find out.

The Aristocrat Leisure Limited (ASX: ALL) share price has bolted to a record high in today's session.

Shares in the gaming technology giant have shrugged off COVID-19 induced lockdowns and restrictions.  

Since the start of the year, shares in Aristocrat have surged more than 54% higher.

In comparison, the broader S&P/ASX200 (ASX: XJO) Index has only managed to gain 12.5% in 2021.

So, what's been propelling the Aristocrat share price higher?

Man sitting at poker machine celebrates a win by raising his arms straight up in the air.

Image source: Getty Images

Digital gaming fuelling Aristocrat share price

Despite the COVID-19 pandemic weighing heavily on traditional gaming machines, the Aristocrat share price has continued to soar.

Shares in the gaming machine giant have been buoyed by growth in its digital gaming business.

Earlier this year, Aristocrat reported its half-year report for FY21.

For the 6 months ending 31 March 2021, operating revenues fell 1% to $2.23 billion and gross profit decreased 3.5% to $1.13 billion.

However, the company declared an 18.4% increase in net profit after tax (NPAT) of $362.2 million.

Aristocrat attributed the increase in profits to substantial growth in its digital segment.

For the first half, 54% of group revenue was generated from the company's digital gaming arm.

Overall, revenue for Aristocrat's digital segment surged more than 28% for the period.

On a booking basis, the company highlighted that it ranks in the top 5 mobile game players across Tier 1 western markets.

The outlook for Aristocrat

Aristocrat's management noted plans for strong growth over the full year to 30 September 2021.

Despite no dollar figure guidance, the company expects to enhance its market-leading position in casino gaming operations and drive further growth in its digital games business.

The gaming giant expects further growth in digital bookings. As a result, Aristocrat expects user acquisition investment to be modestly above the historic range of 25% and 28% of overall digital revenues.  

Aristocrat's growth outlook has also been supported by numerous brokers and analysts.

Recently, leading broker Citi released a bullish outlook on the company, initiating a buy rating of a $46 share price target.

Analysts noted that Aristocrat's digital business and traditional gaming segments are pulling together.

At the time of writing, shares in Aristocrat are up more than 2% for the day at a record high of $47.75.

Motley Fool contributor Nikhil Gangaram has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Record Highs

Woman using smartphone to check product details while shopping in a grocery store aisle.
Record Highs

Woolworths shares jump 9% to all-time high: Buy, sell, or hold?

Here's what the experts tip next.

Read more »

Woman dreaming and sleeping on a cloud up in the sky.
Record Highs

This ASX 200 share hit an all-time high yesterday. Is the sky the limit?

This ASX 200 stock has doubled from its yearly low.

Read more »

A mining worker wearing a hard hat, orange high vis vest, and blue long-sleeved shirt raises his fists in celebration with an excited expression on his face.
Record Highs

BHP shares just hit a record high. Can the run continue?

BHP shares keep climbing after a strong FY26 result.

Read more »

A piggy bank on the cloud in the blue sky symbolising a record high share price.
Record Highs

The Macquarie share price just hit a new record high

Sentiment on Macquarie shares has been improving since the company’s latest earnings were released back in May.

Read more »

Man with backpack spreading his arms out and soaking in the sun.
Record Highs

This ASX 200 stock just hit a record high. Is insider buying adding fuel to the rally?

Insider buying has helped push this ASX stock higher.

Read more »

A piggy bank on the cloud in the blue sky symbolising a record high share price.
Record Highs

Macquarie shares hit another record high. Has the rally gone too far?

Another record high has pushed this stock into focus.

Read more »

A person trying to step over a crack.
Record Highs

BHP shares hit a record high this week. Is the rally about to crack?

BHP shares are cooling after a huge run this year.

Read more »

Three happy industrial engineers analysing the share price.
Record Highs

This ASX stock just hit a record high. Here's why investors are buying

Investors are backing this ASX stock’s growing pipeline.

Read more »