Light & Wonder Inc. (ASX: LNW) shares have been having a tough time recently.
So much so, the ASX 200 share is down almost 35% since the start of the year.
Is this a buying opportunity? Let's see what analysts at Bell Potter are saying about the gaming technology company.
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What is the broker saying?
Bell Potter highlights that the ASX 200 share released its first-quarter update, which was a touch weaker than expected. This was due to soft international shipments and SciPlay revenue. It said:
LNW reported AEBITDA -1% and -3% below BPe and VA consensus, respectively. Profit & loss: LNW reported +2% YoY revenue growth (incl. inorganic) to US$790m below BPe of US$811m and consensus of US$827m, driven by +3% YoY growth in Gaming (BPe +9%), -7% YoY decline in SciPlay (BPe -7%) and +18% YoY growth in iGaming (BPe +8%).
The AEBITDA miss to consensus was driven primarily by weaker than expected International shipments and SciPlay revenue.
In response, the broker has trimmed its earnings estimates for the near term. It adds:
EPS changes: -2%/-1%/0% over CY26/27/28e primarily reflecting: lower international shipments, SciPlay revenue, Nth. Am. non-premium install base growth partially offset by higher Fee per Day (FPD), Gaming margins and buybacks.
Should you buy this ASX 200 share?
While Bell Potter acknowledges that Light & Wonder delivered a disappointing update, it remains positive on the investment opportunity here.
According to the note, the broker has retained its buy rating on its shares with a reduced price target of $190.00 (from $220.00).
Based on its current share price of $102.66, this implies potential upside of 85% for investors over the next 12 months.
As mentioned above, Bell Potter thinks Light & Wonder has had a poor start to the year. But it believes this is largely a one-off and expects a stronger performance in the coming quarters. It said:
1Q26 represents a poor start to the year, however, we note that International shipments, the primary driver for the miss, is typically lumpy QoQ. We believe the decline in GO base install reflects a one-off occurrence that should benefit future quarters.
Notwithstanding the continued disappointment in SciPlay revenue growth, which we now forecast flat YoY for FY26, we continue to believe improving game performance will support BPe and consensus forecasts across CY26-28e. We lower TP on higher RFR and retain Buy. LNW trades on a compelling 9x CY26 EBITA.
