International Game Technology Third Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component International Game Technology (NYSE:IGT) will unveil its latest earnings on Tuesday, July 24, 2012. International Game Technology is a global gaming company that designs, manufactures and markets electronic gaming equipment and systems products.

International Game Technology Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average analyst estimate is for net income of 28 cents per share, a rise of 7.7% from the company’s actual earnings for the year-ago quarter. During the past three months, the average estimate has moved down from 29 cents. Between one and three months ago, the average estimate moved down. It has been unchanged at 28 cents during the last month. For the year, analysts are projecting profit of $1.04 per share, a rise of 11.8% from last year.

Last quarter, the company came in at net income of 27 cents per share against a mean estimate of profit of 25 cents per share, beating estimates after missing them in the previous quarter. In the first quarter, it missed forecasts by 5 cents.

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Wall St. Revenue Expectations: Analysts predict a rise of 15.3% in revenue from the year-earlier quarter to $563.8 million.

A Look Back: In the second quarter, profit fell 11.1% to $61.9 million (21 cents a share) from $69.6 million (23 cents a share) the year earlier, but exceeded analyst expectations. Revenue rose 9.9% to $541.2 million from $492.3 million.

Stock Price Performance: Between May 21, 2012 and July 18, 2012, the stock price had risen $1.10 (7.6%), from $14.49 to $15.59. It saw one of its worst periods between February 7, 2012 and February 16, 2012 when shares fell for eight straight days, dropping 7.2% (-$1.14) over that span. The stock price saw one of its best stretches over the last year between September 9, 2011 and September 16, 2011, when shares rose for six straight days, increasing 9.8% (+$1.37) over that span.

Key Stats:

The company is trying to use this earnings announcement to rebound from income declines in the past two quarters. Net income dropped 33.1% in the first quarter and then again in the second quarter.

On the top line, the company is hoping to build on a revenue increase last quarter. Revenue fell 4.2% in the first quarter after increasing in the second quarter.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 2.16 last quarter. Having a ratio above 2:1 is usually considered a good indicator of a company’s liquidity and ability to meet creditor demands. The company regressed in this liquidity measure from 2.92 in the first quarter to the last quarter driven in part by an increase in liabilities. Current liabilities increased 19.2% to $574.5 million while assets decreased 11.8% to $1.24 billion.

Analyst Ratings: With 13 analysts rating the stock a buy, none rating it a sell and seven rating the stock a hold, there are indications of a bullish stance by analysts.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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