Accel Entertainment (NYSE:ACEL) Posts Earnings Results, Misses Estimates By $0.04 EPS

Accel Entertainment (NYSE:ACEL) issued its quarterly earnings results on Tuesday. The company reported $0.15 EPS for the quarter, missing the consensus estimate of $0.19 by ($0.04), FiscalAI reports. Accel Entertainment had a return on equity of 25.70% and a net margin of 3.79%.The company had revenue of $368.13 million during the quarter, compared to analysts’ expectations of $356.66 million.

Here are the key takeaways from Accel Entertainment’s conference call:

• Record Q2 results: Revenue rose 10% year over year to $368 million and adjusted EBITDA increased 11% to $59 million, while net income nearly doubled to $13 million.
• Chicago is nearing launch after the first city video-gaming licenses began processing; Accel has been approved at 17 of the 39 establishments licensed so far and expects initial locations to go live within weeks, although full deployment could take more than five years.
• Developing markets are becoming meaningful earnings drivers, with revenue up 55% in Nebraska and 47% in Georgia; Nevada revenue rose 17% and Louisiana added the Rice Palace Truck Stop Casino acquisition.
• Accel ended the quarter with $255 million of cash, net leverage of approximately 1.4 times, and an undrawn $300 million revolver, supporting acquisitions, organic investment, and continued share repurchases.
• Illinois growth is being driven by higher productivity rather than machine-count expansion, while Nevada hold per day declined 15.8% because of the rapid shift toward lower-yield convenience-store locations; management expects upgrades and loyalty initiatives to improve results over six to 12 months.

Accel Entertainment Stock Performance

Shares of NYSE:ACEL traded up $0.32 during trading on Wednesday, reaching $12.48. The company had a trading volume of 33,339 shares, compared to its average volume of 348,631. Accel Entertainment has a fifty-two week low of $9.55 and a fifty-two week high of $14.00. The company has a debt-to-equity ratio of 2.02, a current ratio of 2.71 and a quick ratio of 2.64. The stock’s fifty day moving average price is $12.49 and its 200 day moving average price is $11.81. The firm has a market capitalization of $1.02 billion, a price-to-earnings ratio of 20.80 and a beta of 1.02.

Analyst Upgrades and Downgrades

Several research analysts recently commented on ACEL shares. Citigroup reissued a “market outperform” rating on shares of Accel Entertainment in a research note on Wednesday. Zacks Research cut Accel Entertainment from a “strong-buy” rating to a “hold” rating in a report on Friday, May 22nd. Weiss Ratings raised shares of Accel Entertainment from a “hold (c+)” rating to a “buy (b-)” rating in a research report on Friday, June 26th. National Bank Financial set a $15.00 target price on Accel Entertainment in a research report on Wednesday. Finally, Wall Street Zen cut shares of Accel Entertainment from a “strong-buy” rating to a “buy” rating in a research report on Saturday, May 2nd. Four investment analysts have rated the stock with a Buy rating and two have given a Hold rating to the stock. According to data from MarketBeat, Accel Entertainment currently has a consensus rating of “Moderate Buy” and a consensus price target of $14.75.

Insider Activity

In other news, Director Gordon Rubenstein sold 46,346 shares of the stock in a transaction that occurred on Thursday, May 7th. The stock was sold at an average price of $11.34, for a total transaction of $525,563.64. Following the completion of the transaction, the director directly owned 4,946 shares of the company’s stock, valued at approximately $56,087.64. This represents a 90.36% decrease in their position. The sale was disclosed in a filing with the SEC, which is accessible through this hyperlink. Also, insider Derek Harmer sold 20,000 shares of Accel Entertainment stock in a transaction that occurred on Monday, June 15th. The shares were sold at an average price of $13.00, for a total value of $260,000.00. Following the completion of the sale, the insider owned 187,827 shares in the company, valued at approximately $2,441,751. This trade represents a 9.62% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last quarter, insiders sold 104,277 shares of company stock valued at $1,259,917. 14.47% of the stock is owned by corporate insiders.

Institutional Trading of Accel Entertainment

A number of institutional investors have recently added to or reduced their stakes in the stock. CIBC Bancorp USA Inc. acquired a new stake in shares of Accel Entertainment during the 3rd quarter valued at approximately $4,368,000. Millennium Management LLC increased its stake in Accel Entertainment by 252.5% in the 1st quarter. Millennium Management LLC now owns 502,521 shares of the company’s stock valued at $4,985,000 after purchasing an additional 359,948 shares in the last quarter. Goldman Sachs Group Inc. raised its holdings in Accel Entertainment by 177.3% during the fourth quarter. Goldman Sachs Group Inc. now owns 548,952 shares of the company’s stock worth $6,264,000 after purchasing an additional 351,012 shares during the last quarter. Visualize Group LP purchased a new position in shares of Accel Entertainment in the third quarter valued at $2,280,000. Finally, Arrowstreet Capital Limited Partnership raised its stake in shares of Accel Entertainment by 60.6% during the 2nd quarter. Arrowstreet Capital Limited Partnership now owns 391,350 shares of the company’s stock worth $4,606,000 after buying an additional 147,653 shares during the last quarter. Hedge funds and other institutional investors own 55.39% of the company’s stock.

Accel Entertainment Company Profile

Accel Entertainment, Inc is a Chicago-based gaming and entertainment company specializing in the provision of regulated electronic gaming terminals and related management services to licensed establishments across the United States. The company’s core offerings include video gaming terminals (VGTs), digital payment solutions, player loyalty programs and compliance support, all designed to enhance customer engagement and operational efficiency for bars, restaurants, truck stops and convenience stores.

Founded in 2005, Accel Entertainment has built a network that spans multiple states, including Illinois, Pennsylvania, Ohio, and Iowa.