The Aristocrat Leisure Limited (ASX: ALL) share price was on form again on Thursday.
The gaming technology company's shares have just ended the day with a gain of almost 2% to $36.70.
This stretches its one-month return to a decent 11%.
Can the Aristocrat share price keep rising?
The good news is that the team at Citi believe there's still plenty of room for the Aristocrat share price to climb.
According to a note from this morning, the broker has retained its buy rating and $41.00 price target on the company's shares.
Based on the current Aristocrat share price, this implies potential upside of 12% for investors over the next 12 months.
What did the broker say?
Citi has been looking at the company's digital operations, which are now called Pixel United.
While the broker concedes that the mobile gaming market is posting declines on an annual basis, its research indicates that Aristocrat's games are outperforming the market.
In light of this, the broker remains positive on Aristocrat's outlook and continues to forecast solid earnings growth over the coming years. It expects earnings per share of $1.78 in FY 2022 (up from $1.36 per share a year earlier), then $1.95 in FY 2023, and $2.11 in FY 2024.
Citi commented:
Overall, mobile game bookings for the industry look to be on a clear downward trend after having peaked in mid-2021. Bookings for the June 2022 quarter are down 19% on pcp and 28% from the peak. The decline has been broad-based across most genres, with game bookings for titles in the strategy and action genres falling the most, while casino and RPG games have fared better. While industry-wide trends present a risk to Aristocrat's digital bookings outlook, the company's key social casino titles and RAID had outperformed within their respective genres. We remain Buy rated on Aristocrat with an A$41.00 target price.
