Jefferies cuts Everi Holdings stock amid IGT merger

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Jefferies cuts Everi Holdings stock amid IGT merger
Credit: © Reuters.

On Friday, Jefferies downgraded shares of Everi Holdings (NYSE: EVRI ), a casino gaming company, from "Buy" to "Hold" and reduced the price target to $13 from $18. The adjustment follows the recent announcement of Everi's merger with the gaming division of International Game Technology (NYSE: IGT ).

The analyst from Jefferies noted that the merger presents a long-term strategic advantage for shareholders, emphasizing the importance of scale in the industry. The combined ship share of Everi and IGT's gaming business was reported at 36% for the fourth quarter of 2023, based on data from industry sources.

Despite the potential benefits, the analyst expressed concerns about the time frame for completing the merger. The process, which is subject to regulatory approvals, may extend beyond the end of 2024 or early 2025. This extended timeline could result in Everi's shares being valued lower in the near term, based on the anticipated discounted value of the deal.

The revised price target of $13 reflects the analyst's expectation that Everi's stock may trade at a discount due to the uncertainties surrounding the closure of the merger. The new valuation aims to account for the possible delays and the current regulatory environment that the companies must navigate.

Everi's stock performance will likely be closely watched by investors as the merger proceedings continue. The company's ability to achieve the expected scale and synergies from the merger with IGT's gaming business will be essential in determining its future market position and shareholder value.

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