International edition
September 21, 2020

Consumers and clients continue to pull back on spending

Shuffle Master climbs on possible leasing benefits

(US).- Shuffle Master’s stock rose yesterday as the company predicted its leasing service would prove beneficial during the current economic downturn, an analyst said. The Las Vegas-based firm anticipates clients will want to lease machines during the economic slowdown as a way to preserve capital, Steven Wieczynski of Stifel Nicolaus & Co. said in a client note.

C

asino operators and suppliers have been pressured as consumers and clients continue to pull back on spending due to the housing slump, eroding credit, rising food prices and unemployment worries.

Wieczynski, who recently held two days of investor meetings with Shuffle Master executives, is also pleased with the company’s efforts to trim its expenses and improve its capital structure. "Debt levels are low with ample liquidity and cash flows to grow the business," he said.

Wieczynski reaffirmed a "Buy" rating and price target of us$ 7, and suggested Shuffle Master could be a takeover target due to its product base and the likelihood for industry consolidation.

Shares of Shuffle Master added 20 cents, or 5 %, to us$ 4.20 in afternoon trading. Over the past year, the stock has traded between us$ 2.50 and us$ 12.14. The broader market surged Monday as investors hoped President-elect Barack Obama’s plan for a huge infrastructure spending package would help boost the crippled economy.

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