Why Accel Entertainment Stock Accelerated Higher Today
Key Points
Both revenue and profitability rose at satisfying rates.
The two metrics also topped their respective analyst estimates.
A record revenue line and a near-doubling of headline net income pushed Accel Entertainment's (NYSE: ACEL) stock to a double-digit gain on Wednesday. On the back of the company's estimates-beating fourth quarter, investors eagerly snapped up its shares, and they closed the trading session 18% higher in price.
A game winner
Accel is a distributed gaming operator, i.e. it specializes in the installation and operation of casino games. It reported fourth-quarter and full-year 2025 results just after market close on Tuesday. Both periods featured new all-time revenue highs for the company. For the quarter, the top line expanded by almost 8% year-over-year to more than $341 million. The average analyst estimate for the metric was under $336 million.
Will AI create the world's first trillionaire? Our team just released a report on the one little-known company, called an "Indispensable Monopoly" providing the critical technology Nvidia and Intel both need. Continue »
Image source: Getty Images.
Net income under generally accepted accounting practices (GAAP) rose more precipitously, advancing by almost 92% to $16.2 million. The company's per-share earnings were $0.19, beating the consensus pundit projection of $0.15.
Accel management chalked up the increases to "the growth and resilience of our distributed
gaming model combined with our disciplined capital deployment."
Large footprint
Scale was a factor too; Accel didn't hesitate to point out that its products are now live in over 4,500 locations, comprising almost 28,000 gaming terminals.
Investors willing to gamble on gambling-related stocks -- which are always subject to travel industry trends and overall economic health -- should consider this rather sideways play on the sector. Those who aren't so bullish on such titles might be better served with other investments.
Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.