Support for IGT shares

August 20, 2002 8:42 AM
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Suggestions by analysts that some states may be rethinking their opposition to slot machines spurred investors to boost the value of a share in International Game Technology (IGT) last week.

For nearly a month, the world’s largest maker of gaming devices languished in the mid $50 range with most states wrapping up their legislative business without permitting any meaningful expansion of gaming. But, many of these states still faced budgetary problems, primarily finding ways to balance their budgets as mandated by most state constitutions.

One analyst, Larry Haverty of State Street Research & Management Co. told the audience of "Wall Street Week with Fortune" that gaming resistance in some states have already showed signs of weakening. Included in these were Maryland, New York, Pennsylvania and Kentucky. All are desperately seeking new sources of revenues and jumping on the "sin tax" bandwagon would go a long way in reducing the budget needs.

Should these anti-gaming barriers break down, he said, a company such as IGT would benefit greatly because of its dominant position in the industry.

Two weeks ago, IGT shares were trading at $54.95 a share but last Friday, the shares had climbed to $$65.43 a share.