BRSL

We rate International Game Technology PLC (BRSL) as a Hold with a composite score of 64.1/100 at a current price of $13.73. The stock presents a mixed quantitative picture — neither compelling enough to warrant new accumulation nor weak enough to justify selling for existing holders. Our factors are split, and the overall profile suggests patience is warranted.

The rating is primarily driven by strength in value (94th percentile) and stability (79th percentile), which together account for the majority of the composite score. All factors score above the 40th percentile, indicating no material weakness in the quantitative profile. We assign a No Moat rating (33/100), High uncertainty, and Standard capital allocation.

Key items to watch: balance sheet deleveraging progress. Any material change in these dynamics could warrant a reassessment of our rating. The moat trend is stable, which suggests the competitive landscape is stable for now.

International Game Technology PLC holds a lower-quartile position (#45 of 50) within the Services sector, based on our composite quantitative scoring across quality, value, momentum, and stability factors. The composite score of 64.1/100 places it at rank #344 in our full 7,333-stock universe. At $3.5B in market capitalization, International Game Technology PLC is a mid-cap player in the Services space, which limits certain scale advantages but may allow for more agile strategic execution.

Revenue contraction of -1% combined with momentum at the 47th percentile paints a cautious picture of the near-term business outlook. The market appears to be pricing in continued challenges, and a catalyst for reversal is not clearly visible from current data.

The margin cascade tells an important story: gross margins of 47% (-13.1pp vs sector) narrow to operating margins of 27% (+23.8pp vs sector) and net margins of 20.2%, yielding a gross-to-net conversion rate of 43%. This efficient conversion suggests well-controlled operating costs and limited margin leakage between the gross and net levels.

At a current price of $13.73, International Game Technology PLC appears undervalued relative to its fundamentals. Our value factor score of 94/100 reflects a composite assessment across multiple valuation metrics including price-to-earnings, price-to-book, EV/EBITDA, and price-to-sales ratios relative to both sector peers and the broader market. The stock screens as attractively priced on a majority of these measures, suggesting the market may be underappreciating the underlying fundamentals.

The stock currently trades at a P/E of 7.5x (a 68% discount to the sector median of 23.7x), EV/EBITDA of 1.6x (discounted to peers), P/B of 1.5x, P/S of 0.3x. The below-sector P/E suggests possible undervaluation or the market pricing in near-term headwinds.

We assign a High uncertainty rating to International Game Technology PLC. Key risk factors include significant leverage (325% debt-to-equity). The wide range of potential outcomes widens our fair value estimate and increases the possibility of permanent capital impairment. Investors considering this name should size positions accordingly and demand a meaningful margin of safety before initiating.

Specific risk factors that inform our assessment include: significant leverage (325% debt-to-equity). Each of these factors independently widens the distribution of potential outcomes, and in combination they create a risk profile that demands careful position sizing. The stability factor at the 79th percentile and quality factor at the 68th percentile provide a quantitative summary of the overall risk landscape.

Key risk mitigants include: healthy gross margins of 47% provide a buffer against cost pressures; above-average stability (79th percentile) suggests predictable business dynamics; a 4.53% dividend yield anchors total return. These factors partially offset the identified risks and provide downside protection in adverse scenarios. On balance, the risk-reward profile warrants caution and disciplined position management.

We rate International Game Technology PLC's capital allocation as Standard. Management has shown adequate — though not exceptional — stewardship of shareholder capital. Returns on equity stand at 123.0%, and the balance sheet is managed within acceptable parameters (D/E: 325%). Exemplary allocators typically sustain ROE above 20% and D/E below 50%; International Game Technology PLC falls short on at least one dimension.

There is room for improvement in optimizing the capital structure or enhancing shareholder returns. The 4.53% dividend yield provides some income return, but the overall capital allocation framework would benefit from either higher reinvestment returns, improved balance sheet efficiency, or increased shareholder distributions. We will monitor for signs of strategic improvement that could warrant an upgrade.

In summary, International Game Technology PLC receives a Hold rating with a composite score of 64.1/100 (rank #344 of 7,333). Our quantitative framework assigns a No Moat (33/100, trend: stable), High uncertainty, and Standard capital allocation. The average factor score across quality, value, momentum, stability, and investment is 69/100.

Our analysis supports a neutral stance on International Game Technology PLC. While the quantitative profile is not weak enough to warrant selling, it lacks the multi-factor strength required for a buy recommendation. Existing holders should maintain positions and monitor for catalysts — either fundamental improvement or valuation compression — that would shift the risk-reward balance.