Light & Wonder, Inc. (NASDAQ:LNW) is a prominent player in the gaming industry, known for its innovative solutions across various platforms. The company recently reported earnings per share (EPS) of $0.772, which fell short of the estimated $1.08. Despite this, LNW's revenue for the period was approximately $808 million, surpassing the estimated $799 million.
LNW's stock has shown resilience, with a 4.3% increase in the last trading session, closing at $105.99. This rise was supported by higher-than-average trading volume. Over the past four weeks, the stock has gained 11.5%, reflecting investor confidence. A significant factor in this positive trend is LNW's agreement to acquire Grover Gaming's charitable gaming assets for $850 million in cash.
This acquisition is expected to enhance LNW's market reach by leveraging Grover's strong customer relationships. The management believes that the cultural alignment between the two companies will ensure a smooth integration process. This move aligns with LNW's cross-platform strategy and is anticipated to positively impact profitability.
Financially, LNW has a price-to-earnings (P/E) ratio of 30.36, indicating the price investors are willing to pay for each dollar of earnings. The price-to-sales ratio is 2.81, reflecting the company's market value relative to its sales. The enterprise value to sales ratio is 3.94, showing the company's total value compared to its sales.
The enterprise value to operating cash flow ratio is 21.20, suggesting how well LNW can cover its enterprise value with its operating cash flow. The earnings yield is 3.29%, representing the return on investment for shareholders. However, the debt-to-equity ratio is high at 4.55, indicating significant debt usage for growth. The current ratio of 1.88 suggests LNW has a good level of liquidity to cover short-term liabilities.
