Light & Wonder Inc (ASX: LNW) released its quarterly results to the market over the past week, and the brokers like what they see.
Both of the analyst teams at UBS and Macquarie have very bullish share price targets on Light & Wonder shares, which we'll get to shortly.
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Solid, yet unexceptional, first quarter
Firstly, let's look at what the company announced.
Light & Wonder said in its statement to the ASX that revenue grew 2% during the first quarter to US$790 million, "against a strong prior year period''.
The company said:
Light & Wonder delivered a solid start to 2026 underpinned by its highly diversified business model, continued disciplined execution across all three businesses and strong cash flow generation, while demonstrating resilience against a backdrop of macroeconomic and geopolitical uncertainty, including tariff-related pressures. We continue to execute against our commitment to deliver enhanced quality of earnings through recurring revenue(4), with Gaming operations and iGaming as the primary growth drivers during the quarter, each delivering double-digit year-over-year revenue increases. This was further underpinned by continued operational momentum and content strength.
The company's net income came in at US$52 million, down 37% on the first quarter the previous year, "reflecting approximately US$50 million in legal reserve contingencies associated with certain legacy legal matters, which impacted year-over-year net income and net income per share growth by approximately 61% and 67%, respectively''.
The company said its installed base in the North American market grew for the 23rd consecutive quarter.
Light & Wonder Chief Executive Officer Matt Wilson said:
The first quarter of 2026 marks the beginning of the next phase of the Company's growth trajectory: one defined by our content-centric operating model, deepening customer relationships, disciplined execution, expanding margins and enhanced capital structure. We are seeing the benefits of our continued investment in studios and content, as our franchises drive strong game performance across the portfolio. Looking ahead, we remain focused on investing in product innovation and talent to further strengthen our recurring revenue model and enhance our global competitive position as we progress toward our 2028 financial targets.
Shares looking cheap
Macquarie said in a note to clients following the release of the quarterly results that it was positive that Light & Wonder had flagged an acceleration of its buyback in the second quarter.
They said they were confident the company could deliver 5% to 9% EBITDA growth this year.
Macquarie's price target on the stock is $200, compared with $111.02 at the time of writing.
UBS said the first quarter results disappointed against their expectations, "but we have hardly changed our full year estimates or valuation and remain positive on LNW with significant valuation upside''
UBS has a price target of $210 on Light & Wonder shares.
Light & Wonder is valued at $9.09 billion.
