Stocks in the gaming industry have been hot lately. Racetrack and riverboat casino operator Penn National's (NASDAQ:PENN) stock has roughly quadrupled over the past two years, and Ameristar Casinos (NASDAQ:ASCA) has seen its stock just about quintuple. Industry giants MGM Mirage (NYSE:MGG) and Harrah's Entertainment (NYSE:HET) have earned historically rich valuations. Meanwhile, Wynn Resorts (NASDAQ:WYNN), whose first operation doesn't even open until April, already has a $7 billion market cap.

It's somewhat of a paradox, then, that one of the most relevant players in the industry, slot king International Game Technology (NYSE:IGT), has fallen out of favor.

IGT's stock is trading around $29, down from its year-ago highs of around $47 per share. The company had ridden the wave of expansion across the riverboat-gambling states, and it was also benefiting from big replacement sales triggered by a massive industry transition to ticket-based coinless slots. But a short-term slowdown in domestic slot sales and a weak outlook on the current fiscal year ending in September has hit the stock -- perhaps too hard.

At under 22 times this year's earnings, IGT stock looks reasonable. But the company will get a boost over the next several years, as mass slot operations -- over 30,000 new slots -- start to come online in Pennsylvania, with the possibility of other states following suit. International sales should also continue to grow, pending legislation in the United Kingdom and, to a lesser extend, in Macau.

IGT accounts for more than two-thirds of domestic slot machines and has a reliable gaming-operations business that accounts for about half of sales. The company buys back its stock and pays a small dividend. I don't see much downside risk here, and the more I think about it, the more I think that this is an excellent opportunity to snap up shares of the dominant slot player.

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Fool contributor Jeff Hwang owns shares of International Game Technology and Ameristar Casinos. The Fool has a disclosure policy.