What happened

London-based lottery and gambling equipment maker International Game Technology (IGT -2.16%), which was already on something of a tear and far outperformed the S&P 500 over the past year, saw its stock soar 14.2% through 1 p.m. ET Thursday -- and it's no great mystery why.

IGT announced Thursday morning that it is exploring "strategic alternatives" for its Global Gaming and PlayDigital divisions -- the company's two best-performing units over the past year -- with the goal of driving "long-term sustainable value" for the stock.  

So what

International Game Technology's press release makes it clear that it's not entirely clear on exactly which strategic alternative it's going to take, however.

"IGT's Board of Directors is considering a broad range of potential alternatives, including but not limited to a sale, merger or spin-off ... as well as retaining and further investing in the Global Gaming and PlayDigital businesses," it said in the press release.

So ultimately, IGT might sell off its best divisions (presumably at a premium price), or spin them off (in which case they might fetch a higher stock valuation once freed from the underperforming Global Lottery business), or ... do nothing much different from what it's already doing.

To emphasize the point, IGT notes that "no decision has been made regarding any alternative, there is no timeline for the review."

Now what

Given the wide range of possibilities International Game Technology laid out, I'm not sure which of them investors are reacting to Thursday, or which course of action it is that they hope IGT takes.

It's clear that investors seem encouraged by management's assertion that "the intrinsic value of IGT's market-leading businesses and diversified cash flow profile is not currently reflected in our stock price," and hope that whatever management does will help to raise the share price further. Then again, when you consider that IGT stock trades at nearly 26 times earnings today, but is expected to grow earnings at 19% or less over the next five years, IGT stock actually does look pretty fairly valued -- or even slightly overvalued.

Maybe management has a move in mind that will succeed in raising the stock price even more. But I have my doubts.