SEARCH NEWS:

 

IGT Reeling in Investors

"Early investors have already hit the jackpot with the company's shares: IGT closed Thursday at $31.38, up 25 cents, a 52-week high. That's almost double its low of $16.19, set Sept. 27, 1999. The stock was trading in the low $20s as recently as mid-May.

"…President and Chief Operating Officer Thomas Baker takes great pride both in IGT's financial performance and in a product line that includes Wheel of Fortune-, Jeopardy!-, Elvis- and Addams Family-themed games, along with the more traditional Red White and Blue and Double Diamond models. The company spent just over $45 million on research and development last year as game designers constantly add new wrinkles.

"…Since, with regular maintenance, the machines can last for decades, the key to continuing profitability is the replacement market. [President and Chief Operating Officer Thomas] Baker is particularly bullish about IGT's prospects.

"Not only do people get bored with a particular game after a few years, he said, but IGT has invested heavily in developing `cashless' technology.

"…Baker is convinced that cashless is the coming wave -- and he intends to ride it.

"…The prospect of replacing tens of thousands of machines with new cashless models is one of the factors that has been driving up the company's stock price, said Robin Farley, a gaming analyst with PaineWebber in New York.

"…IGT did just under a billion dollars in revenue last year, split approximately 50-50 between machine sales and the take from the progressive network. Although the company is carrying in excess of $750 million in debt, most of that was accrued during a three-and-a-half year binge of stock buybacks during which the number of outstanding shares was sliced almost in half from 140 million to 72 million…"

< Gaming News