Aristocrat Leisure Ltd

ALL: XASX (AUS)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	A$66.00	Cpqgymn	Nvjlgwlmf

We Expect Aristocrat's Strong Position in Leased Machines to Afford a Quick Recovery; FVE Lifts 22%

Angus Hewitt

Oct 8, 2020

We raise our fair value estimate for Aristocrat Leisure to AUD 33 per share, from AUD 27, following the transition to a new analyst. We expect Aristocrat Leisure will continue to dominate the electronic gaming machine, or EGM, market. With a strong balance sheet and commanding market position, the firm's research and development, or R&D, expenditure is unmatched by peers. This investment is the lifeblood of any electronic gaming manufacturer, especially given rapidly changing technology, and allows Aristocrat to maintain game quality, differentiate products from lower-end competitors, and defend its narrow economic moat.

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