Macquarie tips nearly 40% upside for this ASX 200 stock

Here's why Macquarie is betting on this business.

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Key points

  • Light & Wonder Inc. has attracted Macquarie's attention due to its potential for significant returns, focusing on its strong presence in the North American gaming market.
  • Macquarie is optimistic about US casino revenue trends, noting steady growth and opportunities, especially in regional sectors and Las Vegas, with the industry showing resilience.
  • Light & Wonder's new LightWave cabinet and content, alongside a positive outlook with a 12-month price target from Macquarie suggesting big returns, underline its promising investment prospects.

The S&P/ASX 200 Index (ASX: XJO) stock Light & Wonder Inc. (ASX: LNW) is a company that has captured the attention of Macquarie analysts because of the potential for big returns.

Light & Wonder is a cross-platform global gaming company that is a significant player in slot machines in the North American market. The machines can be bought or leased. It also offers digital game content, which can be accessed online, including through mobile devices. The business also has casino management systems, as well as iGaming and casino table games.

Macquarie is bullish about the business after seeing the latest data from US casinos.

Macquarie said in a note that it had looked at US casino gaming revenue data from 26 jurisdictions in August 2025, covering nearly all commercial casinos.

Regional gaming revenue, representing 85% of volumes, came to US$3.8 billion, being 6% growth year-over-year. Macquarie said that 2 percentage points came from openings and expansions in key states, including Illinois, Louisiana and Virginia. Overall, in 2025 year to date, growth has been 3% year-over-year or 1% excluding new openings and expansions.

Las Vegas is seeing particularly strong growth, though it only represented 15% of volume, reaching US$679 million and delivering 6% year-over-year growth. The 2025 year-to-date growth has been 1%, though trends have shown consistent improvement over the year. In August, 'tables' showed 13% year-over-year growth, with softer turnover offset by a "below-average hold rate in the prior period, and with slots flat."

Macquarie said that when isolating gaming product revenue disclosed in 12 jurisdictions, representing a third of total regional gaming revenue, slots were up 5% year-over-year (or 2% in 2025 year to date). Tables revenue in August was down 3% year-over-year (and down 3% for 2025 year to date).

Overall, Macquarie said that US casino gaming revenue remains resilient. It also said that the Global Gaming Expo (G2E) in Las Vegas in early October 2025 could be a catalyst, and will see most slot manufacturers announcing new products (with hardware and content).

For the ASX 200 stock Light & Wonder, Macquarie is particularly interested in the reception of the new LightWave cabinet and associated content.

Big potential returns from the ASX 200 stock

A price target is where analysts think the share price will be in 12 months. Macquarie currently has a price target of $180 on the business. That suggests a possible rise of around 40% over the next year. Of course, we should also think about the long-term, not just the next 12 months.

That could mean the ASX 200 stock delivers a significant market-beating result over the next year, if Macquarie is right.

Motley Fool contributor Tristan Harrison 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 and Macquarie Group. The Motley Fool Australia has positions in and has recommended Macquarie Group. 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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