Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, machine gaming company Multimedia Games Holding Company (MGAM.DL) has earned a coveted five-star ranking.
With that in mind, let's take a closer look at Multimedia Games, and see what CAPS investors are saying about the stock right now.
Multimedia Games facts
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Headquarters (founded) |
Austin, Texas (1991) |
Market Cap |
$750.5 million |
Industry |
Casinos and gaming |
Trailing-12-Month Revenue |
$172.7 million |
Management |
CEO/COO Patrick Ramsey CFO Adam Chibib |
Return on Equity (average, past 3 years) |
15.7% |
Cash/Debt |
$81.5 million / $31.5 million |
Competitors |
Bally Technologies International Game Technology |
On CAPS, 86% of the 90 members who have rated Multimedia Games believe the stock will outperform the S&P 500 going forward.
Earlier this week, one of those Fools, TMFInnovator, explained why the stock still has plenty of room to run:
Wall Street just can't figure this one out.
-MGAM soars 19% in April after crushing estimates once again ($0.31 reported vs $0.19 estimate). But this is nothing new. MGAM has beaten estimates by AT LEAST 38% in each of the past four quarters.
-Current estimates are still below company expectations ($0.83 2013 EPS analyst estimates, vs $1 company expectations). If $1/share does indeed happen in 2013, the stock is still pricey at $26 today. But earnings doubled in '11 and then quadrupled in '12, so the valuation isn't exactly unreasonable.
-The economy is improving, and the gaming industry should benefit from additional consumer discretionary income.
Though perhaps not a "buy and forget about it" company, I'm willing to make the bet that they outperform in the short-term.