Brean Murray Carret Cuts Price Target on Bally Technologies (BYI), Sees Strong Upside to Fiscal 2012 Guidance

Brean Murray Carret & Co. is reaffirming its Buy rating on shares of Bally Technologies (NYSE: BYI), but is reducing its price target from $51 to $43.

The company recently reported its fourth quarter results with earnings, revenues, and gross profit beating the firms expectations while. The company reported its largest ship share since 2009, inline with industry peers WMS (NYSE: WMS) and IGT (NYSE: IGT).

Following Bally Tech's fourth quarter results, the firm cut its 2012 EPS estimate by $0.39 to $2.34 and is introducing its 2013 estimate at $2.97. Brean Murray Carret notes that its estimate factor in high SG&A and lower margins on game sales, along with a conservative total game sales estimate.

The firm appreciates that management released a guidance which was actually plausible, but states that no range doesn't allow for any insight to new opportunities. Brean Murray Carret believes that BYI's $2.15 EPS guidance for 2012 is overly pessimistic.

After factoring in the higher number of gaming ops at the end of fiscal 2011, reduced share count, execution of contracts in Canada, Italy, New York, and with Penn National (Nasdaq: PENN) on schedule, Brean Murray Carret dose not see any reason why EPS couldn't exceed $2.40 for fiscal 2012.

For more ratings news on Bally Technologies click here and for the rating history of Bally Technologies click here.

Shares of Bally Technologies closed at $28.92 yesterday.

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