Here's why this ASX 200 stock down 10% is a buy

A broker has put a fresh buy recommendation on this ASX 200 stock. 

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The S&P/ASX 200 Index (ASX: XJO) has continued to flirt with record highs in the past weeks

It is now up almost 11% in the last year. 

However not every stock in the index has enjoyed this success. 

One such company is ASX 200 stock Light & Wonder Inc (ASX: LNW). 

What is Light & Wonder Inc

Light & Wonder engages in the development of technology-based products and services and associated content. It operates through the following segments: Gaming, SciPlay, and iGaming.

The stock has had a somewhat volatile last 12 months, ultimately down more than 10% in that span. 

The second-quarter results for 2025 led to a share price fall of 4.5% back on August 7th.

According to the results, consolidated revenue of US$809 million was a 1% drop from the same time last year.

The company's Gaming and SciPlay divisions saw revenue decrease by 2%, whilst its iGaming unit had a 9% rise to reach a new quarterly record.

It seems now the tide may be turning. Following earnings results on August 7th, the stock price has rebounded from roughly $118.00 to yesterday's closing price of $144.10. 

It seems brokers believe the stock price is still a value. 

Brokers all tipping upside 

Yesterday, Stuart Bromley, Medallion Financial Group (via The Bull) was the latest broker to list this ASX 200 stock as a buy. 

He sees potential buy-side tailwinds emerging. He believes markets reacted cautiously due to concerns about tariffs and global economic uncertainty. If these issues ease over the next six months, the stock could benefit.

The company recently expanded its buy-back program by $US500 million. A move to sole ASX listing possibly by the end of 2025 boosts local liquidity and creates buy-side tailwinds. 

With a clearer path to inclusion in the S&P/ASX 50, passive inflows should increase as index funds add holdings to maintain weightings.

Mr Bromley isn't the first broker to tip upside in this stock in the past month. 

Morgans has a buy rating and $175.00 price target on Light & Wonder's shares.

Elsewhere, Macquarie has a price target of $180.00. 

Commentary out of these brokers said the current share price is undervalued compared to its competitors. 

From its current share price, these targets indicate upside between 21-25%. 

Motley Fool contributor Aaron Bell has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Light & Wonder. The Motley Fool Australia has recommended Light & Wonder. 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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