LIGHT & WONDER INC (LNW)
US80874P1093 - Common Stock
We assign a fundamental rating of 5 out of 10 to LNW. LNW was compared to 134 industry peers in the Hotels, Restaurants & Leisure industry. While LNW belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. LNW has a valuation in line with the averages, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
In the past year LNW was profitable.
LNW had a positive operating cash flow in the past year.
In multiple years LNW reported negative net income over the last 5 years.
Of the past 5 years LNW 4 years had a positive operating cash flow.
1.2 Ratios
LNW has a better Return On Assets (5.53%) than 71.64% of its industry peers.
The Return On Equity of LNW (38.93%) is better than 88.81% of its industry peers.
Looking at the Return On Invested Capital, with a value of 13.24%, LNW belongs to the top of the industry, outperforming 82.09% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for LNW is below the industry average of 10.22%.
The 3 year average ROIC (7.15%) for LNW is below the current ROIC(13.24%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.53% | ||
| ROE | 38.93% | ||
| ROIC | 13.24% |
ROA(3y)22.93%
ROA(5y)12%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)7.15%
ROIC(5y)N/A
1.3 Margins
LNW has a better Profit Margin (9.95%) than 73.88% of its industry peers.
LNW's Operating Margin of 23.73% is amongst the best of the industry. LNW outperforms 85.82% of its industry peers.
LNW's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 70.51%, LNW belongs to the top of the industry, outperforming 85.07% of the companies in the same industry.
In the last couple of years the Gross Margin of LNW has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 23.73% | ||
| PM (TTM) | 9.95% | ||
| GM | 70.51% |
OM growth 3YN/A
OM growth 5Y6.52%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y2.96%
GM growth 5Y2.22%
2. Health
2.1 Basic Checks
LNW has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
Compared to 1 year ago, LNW has less shares outstanding
Compared to 5 years ago, LNW has less shares outstanding
The debt/assets ratio for LNW is higher compared to a year ago.
2.2 Solvency
LNW has an Altman-Z score of 2.39. This is not the best score and indicates that LNW is in the grey zone with still only limited risk for bankruptcy at the moment.
With a decent Altman-Z score value of 2.39, LNW is doing good in the industry, outperforming 71.64% of the companies in the same industry.
LNW has a debt to FCF ratio of 9.68. This is a negative value and a sign of low solvency as LNW would need 9.68 years to pay back of all of its debts.
LNW has a Debt to FCF ratio of 9.68. This is in the better half of the industry: LNW outperforms 65.67% of its industry peers.
LNW has a Debt/Equity ratio of 4.90. This is a high value indicating a heavy dependency on external financing.
LNW's Debt to Equity ratio of 4.90 is on the low side compared to the rest of the industry. LNW is outperformed by 60.45% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.9 | ||
| Debt/FCF | 9.68 | ||
| Altman-Z | 2.39 |
ROIC/WACC1.36
WACC9.73%
2.3 Liquidity
A Current Ratio of 1.85 indicates that LNW should not have too much problems paying its short term obligations.
LNW has a better Current ratio (1.85) than 82.84% of its industry peers.
A Quick Ratio of 1.58 indicates that LNW should not have too much problems paying its short term obligations.
LNW has a Quick ratio of 1.58. This is amongst the best in the industry. LNW outperforms 80.60% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.85 | ||
| Quick Ratio | 1.58 |
3. Growth
3.1 Past
LNW shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -16.16%.
LNW shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 12.63%.
Measured over the past years, LNW shows a decrease in Revenue. The Revenue has been decreasing by -2.91% on average per year.
EPS 1Y (TTM)-16.16%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%9100%
Revenue 1Y (TTM)12.63%
Revenue growth 3Y19.54%
Revenue growth 5Y-2.91%
Sales Q2Q%11.9%
3.2 Future
Based on estimates for the next years, LNW will show a very strong growth in Earnings Per Share. The EPS will grow by 31.84% on average per year.
The Revenue is expected to grow by 5.67% on average over the next years.
EPS Next Y127.2%
EPS Next 2Y78.34%
EPS Next 3Y56.06%
EPS Next 5Y31.84%
Revenue Next Year11.26%
Revenue Next 2Y9.31%
Revenue Next 3Y8.09%
Revenue Next 5Y5.67%
3.3 Evolution
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 28.42 indicates a quite expensive valuation of LNW.
Compared to the rest of the industry, the Price/Earnings ratio of LNW is on the same level as its industry peers.
Compared to an average S&P500 Price/Earnings ratio of 30.20, LNW is valued at the same level.
Based on the Price/Forward Earnings ratio of 16.86, the valuation of LNW can be described as correct.
Compared to the rest of the industry, the Price/Forward Earnings ratio of LNW indicates a somewhat cheap valuation: LNW is cheaper than 72.39% of the companies listed in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 23.28, LNW is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.42 | ||
| Fwd PE | 16.86 |
4.2 Price Multiples
60.45% of the companies in the same industry are more expensive than LNW, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, LNW is valued a bit cheaper than the industry average as 71.64% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 20.93 | ||
| EV/EBITDA | 10.69 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The decent profitability rating of LNW may justify a higher PE ratio.
A more expensive valuation may be justified as LNW's earnings are expected to grow with 56.06% in the coming years.
PEG (NY)0.22
PEG (5Y)N/A
EPS Next 2Y78.34%
EPS Next 3Y56.06%
5. Dividend
5.1 Amount
LNW does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
LIGHT & WONDER INC
NASDAQ:LNW (11/4/2024, 8:21:16 PM)
After market: 94.36 0 (0%)94.36
+0.14 (+0.15%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap8.37B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
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EPS beat(8)
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EPS beat(16)
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PT rev (1m)
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Revenue NQ rev (1m)
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Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.42 | ||
| Fwd PE | 16.86 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)0.22
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.53% | ||
| ROE | 38.93% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 23.73% | ||
| PM (TTM) | 9.95% | ||
| GM | 70.51% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.56
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.9 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.85 | ||
| Quick Ratio | 1.58 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)-16.16%
EPS 3YN/A
EPS 5Y
EPS Q2Q%
EPS Next Y127.2%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)12.63%
Revenue growth 3Y19.54%
Revenue growth 5Y
Sales Q2Q%
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y