Game industry supplier actions International Game Technology (NYSE: IGT) jumped as high as 13% in trading Thursday after getting a major upgrade from an analyst. Shares slipped late in the session and were up 5.6% at 3:30 p.m. EDT.
Analyst Benjamin Chaiken at Credit Suisse Group increased its price target for IGT’s share from $ 35 per share to $ 36 per share. It might be a small move, but it represents an implied rise of over 50% depending on where the stocks are currently trading.
The stock quote was maintained at a level of outperformance, so only the price target itself changed. Gaming stocks, in general, are expected to perform well in the second half of the year, given record gaming levels in Nevada and a strong recovery for casinos emerging from the pandemic.
I wouldn’t give too much weight to an analyst rating or a change in price target because it doesn’t fundamentally change a company’s performance. In the case of today’s upgrade, the price target hasn’t even moved much.
What is more important in the long term is the trajectory of the company. IGT has long been a key supplier to the gaming industry, and now their challenge is to build a business to serve the growing online gaming business. If she can do it, it could be worth growing for years to come. But I think we have to see how the second half of 2021 results come in before we get too excited about this game stock.
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