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MARKETS LIVE BLOG:

STOCKS SLIP WITH MIDEAST TENSIONS, EARNINGS IN PLAY

Oil pares losses as traders anticipate Israel's response to Iranian attack

Gaming Stocks' Earnings Lineup for Oct 31: ZNGA, IGT, CHDN

Zacks Equity Research
Updated

The gaming industry has been experiencing growth primarily due to a strong domestic market. Relaxed government regulations with respect to online casinos and sports betting are contributing to the growth.

The recent court ruling, which allows sports betting at casinos in the United States, is a positive.

With continued innovation and rising use of smartphones as well as other portable devices, the gaming industry is positioned for near-term growth. More than 80 countries have legalized online gaming, widening its scope. Notably, Europe is considered the world’s largest online gaming market.

Additionally, improving tourism in Las Vegas and rising demand for gaming and leisure will continue to drive gaming stocks. Moreover, strength in the lottery business bodes well.

Moreover, the ongoing shift from physical to digital versions of video games is allowing gaming companies to monetize live service offerings. This, in turn, adds to the companies’ digital revenues, which are a major chunk of total revenues.

Let’s see what’s in store for the following three gaming stocks slated to report third-quarter 2018 earnings on Oct 31.

Zynga’s ZNGA results are likely to benefit from growth in live service revenues and its prudent cost structure. Gram Games acquisition is also expected to aid top-line growth.

The company has an Earnings ESP of 0.00% and a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

According to the Zacks model, a company with a Zacks Rank #1, 2 (Buy) or 3 has a good chance of beating estimates if it also has a positive Earnings ESP. Zacks Rank #4 (Sell) or #5 (Strong Sell) are best avoided.

Notably, the company’s earnings met the Zacks Consensus Estimate in three of the trailing four quarters, delivering an average negative earnings surprise of 8.33%.

Zynga Inc. Price and EPS Surprise

Zynga Inc. Price and EPS Surprise | Zynga Inc. Quote

International Game Technology IGT is likely to benefit from strength in lottery business and improving gaming business. Additionally, new product releases are anticipated to drive the top line.

The company has a Zacks Rank #3 and an Earnings ESP of -4.26%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

We note that the company surpassed the Zacks Consensus Estimate in two of the trailing four quarters, with an average positive earnings surprise of 19.74%.

International Game Technology Price and EPS Surprise

International Game Technology Price and EPS Surprise | International Game Technology Quote

Churchill Downs Incorporated CHDN is expected to cash in on the growing sports betting markets. Moreover, with the recent court ruling allowing sports betting in the United States, the company is expected to benefit from the ruling.

Churchill Downs has a Zacks Rank #4 and an Earnings ESP of 0.00%.

The company surpassed the Zacks Consensus Estimate in three of the trailing four quarters, with an average positive earnings surprise of 11.29%.

Churchill Downs, Incorporated Price and EPS Surprise

Churchill Downs, Incorporated Price and EPS Surprise | Churchill Downs, Incorporated Quote

The Hottest Tech Mega-Trend of All

Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.

See Zacks' 3 Best Stocks to Play This Trend >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Zynga Inc. (ZNGA) : Free Stock Analysis Report
 
Churchill Downs, Incorporated (CHDN) : Free Stock Analysis Report
 
International Game Technology (IGT) : Free Stock Analysis Report
 
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Zacks Investment Research