International Game's Stock, Dividend On Growth Path

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International Game Technology ( IGT ), the world's biggest maker of slot machines, can't seem to give away enough cash to shareholders.

The company recently hiked its quarterly dividend for the third time this year, to 10 cents a share, payable Oct. 4 to shareholders of record on Sept. 19. That brings the annual payout to 40 cents a share, good for a yield of 2% at the current share price.

While that trails the S&P average of 2.50%, International Game has offered superior capital gains so far this year, rising 34% vs. the S&P 500's 14% increase. For the past 12 months, it's up 56%, also easily beating the S&P.

Currently, the stock is trading in a tight range as it shapes a flat base with a possible 20.35 buy point. International Game had previously formed a flat base, but it pulled back soon after clearing a 17.59 buy point May 9. It triggered IBD's 8% sell rule after sinking below the 50-day line in June.

International Game is in the highly rated Leisure-Gaming/Equipment industry group, which includes Big Cap 20 stockLas Vegas Sands ( LVS ) and IBD 50 stockBally Technologies ( BYI ).

The company's Composite Rating is 95, eighth best in the 30-member group. Profits and pretax margins have been on the rebound since the recession year of 2009. But earnings for the current quarter are seen slipping 10% from a year earlier to 34 cents a share following strong growth ranging from 33% to 65% over the past four quarters.

At the start of the year, International Game offered a quarterly dividend of 7 cents a share before hiking it a penny each time in March and June. The company said the latest payout will mark the 42nd straight quarter that it has paid a dividend, the longest streak in the gaming sector.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Investing Ideas

Referenced Stocks: BYI , IGT , LVS

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