What happened 

Shares of gaming supplier International Game Technology PLC (NYSE:IGT) jumped as much as 15.9% in trading Wednesday after reporting third-quarter 2018 results. At 12:05 p.m. EDT, shares were holding at a 13.6% gain on the day.

So what

Revenue was actually down 5% versus a year ago to $1.16 billion, but the company posted net income of $22.3 million, or $0.11 per share, versus an $803.6 million loss a year ago. On an adjusted basis, which pulls out one-time items, earnings were $0.31 per share, down 23% from a year ago.

Slot machine showing all sevens.

Image source: Getty Images.

Despite declining results, the stock is up because earnings were better than expected. Analysts were expecting $0.28 per share in earnings, so there was a solid beat on the bottom line, which overshadowed the overall decline. 

Now what

IGT has been extremely volatile because investors don't know if the company is potentially a high-growth stock or an overleveraged disaster waiting to happen. At the end of the third quarter, the company had $7.57 billion of net debt, and there wasn't much leeway operationally if operations start to deteriorate because of a recession or slowdown in gaming. 

High debt and declining revenue are enough to keep me out of the stock today, and investors should be careful about betting big on such a highly leveraged company that doesn't have growth to go along with it.