Accel Entertainment delivered steady third quarter results, as revenue and earnings per share both exceeded Wall Street expectations. Management attributed the performance to ongoing strength in its core markets of Illinois and Montana, alongside improved efficiency in capital deployment and operational focus on higher-yielding locations. CEO Andrew Rubenstein highlighted that "growth this quarter was supported by higher gaming terminal counts, stable machine performance and improved efficiency in capital deployment," underscoring the company's disciplined approach to market expansion and asset optimization.

Is now the time to buy ACEL? Find out in our full research report (it’s free for active Edge members).

While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.

Our Top 5 Analyst Questions From Accel Entertainment’s Q3 Earnings Call

• Steven Pizzella (Deutsche Bank) asked about the Illinois strategy and the potential upside from the ticket-in, ticket-out rollout. CEO Andrew Rubenstein explained the company will continue route optimization, expecting stable machine counts and growing average revenue per machine, with TITO benefits likely more visible by the second quarter next year.
• Steven Pizzella (Deutsche Bank) inquired about uses of free cash flow going forward. President Mark Phelan and CFO Brett Summerer indicated cash will be allocated flexibly across M&A, share buybacks, and debt reduction, following a rigorous return-on-investment process.
• Samir Ghafir (Macquarie) questioned whether the M&A environment has shifted due to changes in public market valuations. Rubenstein replied that seller expectations are slowly adjusting to lower transaction multiples, but a lag remains in M&A market dynamics.
• Samir Ghafir (Macquarie) asked about growth prospects in Nevada. Rubenstein noted recent additions of new locations, outperforming prior trends, and expressed confidence in continued market share gains in the region.
• Gregory Gibas (Northland) asked about priorities for bolt-on M&A and progress at Fairmount Park. Phelan emphasized Louisiana as the top priority for bolt-ons and cited ongoing momentum at Fairmount Park, with development plans still under review.

Catalysts in Upcoming Quarters

For upcoming quarters, the StockStory team will be tracking (1) further adoption and revenue impact of ticket-in, ticket-out technology in Illinois, (2) the pace of bolt-on M&A activity, especially in Louisiana and other focus states, and (3) continued growth and operational milestones at Fairmount Park. We will also monitor legislative developments that could open new markets and sustained execution on core market optimization.

Accel Entertainment currently trades at $10.41, up from $9.92 just before the earnings. At this price, is it a buy or sell? See for yourself in our full research report (it’s free for active Edge members).

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