Deutsche Bank Downgrades Scientific Games (SGMS) to Hold; Trajectory of Business Model has Stagnated

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Deutsche Bank downgraded Scientific Games (NASDAQ: SGMS) from Buy to Hold with a price target of $7.00 (from $10.00).

Deutsche analyst said, "Given 1) future opportunities are tough to handicap and quantify, and the competitive bidding is fierce, 2) recent acquisitions have called into question the capital allocation strategy, 3) the core business has become more competitive and faces structural challenges, 4) the China instant ticket business has regressed, and 5) Italian scratch off trends have softened further, we are downgrading SGMS." (FY12 EPS estimate cut from $0.36 to $0.12 and FY13 from $0.63 to $0.22)

For an analyst ratings summary and ratings history on Scientific Games click here. For more ratings news on Scientific Games click here.

Shares of Scientific Games closed at $7.00 yesterday, with a 52 week range of $5.53-$13.08.

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