Gaming products and services provider Light & Wonder (NASDAQ: LNW) will be announcing earnings results today after market close. Here’s what investors should know.
Light & Wonder missed analysts’ revenue expectations by 2.3% last quarter, reporting revenues of $817 million, up 11.8% year on year. It was a softer quarter for the company, with a significant miss of analysts’ EPS estimates and a miss of analysts’ Social Gaming revenue estimates.
Is Light & Wonder a buy or sell going into earnings? Read our full analysis here, it’s free.
This quarter, analysts are expecting Light & Wonder’s revenue to grow 4% year on year to $800.8 million, slowing from the 12.9% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.95 per share.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Light & Wonder has only missed Wall Street’s revenue estimates once over the last two years, exceeding top-line expectations by 3.3% on average.
Looking at Light & Wonder’s peers in the consumer discretionary segment, some have already reported their Q4 results, giving us a hint as to what we can expect. DraftKings delivered year-on-year revenue growth of 13.2%, missing analysts’ expectations by 0.9%, and Churchill Downs reported revenues up 11.2%, topping estimates by 0.9%. DraftKings traded up 15.2% following the results while Churchill Downs’s stock price was unchanged.
Read our full analysis of DraftKings’s results here and Churchill Downs’s results here.
Valuation multiples for many growth stocks have not yet reverted to their early 2021 highs, but the market has been optimistic as of late due to a soft landing. This is an economic situation where rate hikes successfully quelled inflation but did not send the economy into a recession. Furthermore, recent rate cuts and Donald Trump's triumph in the 2024 Presidential election have been tailwinds for the market, and while some of the consumer discretionary stocks have shown solid performance, the group has generally underperformed, with share prices down 3.6% on average over the last month. Light & Wonder is up 15.9% during the same time and is heading into earnings with an average analyst price target of $112.75 (compared to the current share price of $101.13).
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