Another distribution deal for its LT-3 terminals has Cantor Fitzgerald Canada analyst Ralph Garcea feeling bullish about Innova Gaming Group (Innova Gaming Group Stock Quote, Chart, News: TSX:IGG).
This morning, Innova Gaming announced a distribution deal with Tonk Group to distribute LT-3 terminals in New Hampshire under a charitable program regulated by the New Hampshire Lottery.
“With this agreement in place, we expect to be in a position to begin deploying LT-3 terminals in the fourth quarter of 2016 into the state of New Hampshire — our sixth North American market in which we will have LT-3s deployed,” said CEO Richard Weil. “Tonk will seek to secure suitable veteran, fraternal or charitable locations to place terminals as authorized by the New Hampshire laws and regulations. We are looking forward to working with Tonk and the New Hampshire Lottery to assist charities and social programs in the state that benefit from gaming activities.”
Garcea says this deal represents a potential 300-400 LT-3 units over the next several years for Innova, a development he says has real impact.
“LT-3 units are very profitable,” explains Garcea. “We estimate that every 100 new units installed is worth about $0.50 to our valuation. Over the next few years, IGG could go from ~1,950 LT-3 installed units to ~5,000 with just its current contracts.”
In a research update to clients today, Garcea maintained his “Buy” rating and one-year price target of $6.00 on Innova Gaming, implying a return of 441 per cent at the time of publication.
We Hate Paywalls Too!
At Cantech Letter we prize independent journalism like you do. And we don't care for paywalls and popups and all that noise That's why we need your support. If you value getting your daily information from the experts, won't you help us? No donation is too small.