Insights

These brokers think the Aristocrat (ASX:ALL) share price can keep climbing

Brokers remain positive on this tech share…
The post These brokers think the Aristocrat (ASX:ALL) share price can keep climbing appeared first on The Motley Fool Australia. –

The Aristocrat Leisure Limited (ASX: ALL) share price is on course to end the week with a small decline.

At the time of writing, the gaming technology company’s shares are down almost 1% to $44.88.

Despite this, the Aristocrat Leisure share price is still up a whopping 43% since the start of the year.

Can the Aristocrat share price go even higher?

The good news for shareholders is that a couple of leading brokers believe the Aristocrat share price can keep rising from here.

For example, the team at Goldman Sachs have recently put a buy rating and $48.60 price target on the company’s shares.

Based on the current Aristocrat share price, this suggests there’s still a further 8.3% upside left for its shares.

Goldman is positive on the company due to its strong balance sheet, continued design and development (D&D) investment to drive growth, and its attractive valuation. In respect to the latter, the broker highlights that the company’s shares are trading largely in line with the average for ASX 200 industrials. This is despite its significantly stronger growth potential.

It commented: “We stay Buy on ALL noting that our MT positive thesis on ALL remains firmly intact, given i) balance sheet strength, ii) management’s focus on continued D&D investment to drive sustained LT growth, iii) leaving it well positioned for further share gains or M&A opportunities, and iv) relative valuation support, trading at ~28x 1-yr fwd PER, broadly in line with ASX200 industrials despite >30% EPS growth forecast in FY22E.”

Who else is bullish?

Another broker is even more bullish on the Aristocrat share price. According to a recent note out of Credit Suisse, its analysts have an outperform rating and $50.30 price target on its shares. This implies potential upside of 12% over the next 12 months.

Credit Suisse believes that Aristocrat’s growing Digital business will benefit from lower mobile platform fees. This follows recent regulatory pressure on app stores following Epic Games’ court battle with Apple.

The broker has previously estimated that Aristocrat could pay a commission in the region of $700 million in FY 2021 to mobile platforms such as Apple’s App Store and Google Play. Clearly, any reduction in fees would be a big win for the company.

All in all, the Aristocrat share price may already be smashing the market in 2021, but these brokers appear to believe its run could continue.

The post These brokers think the Aristocrat (ASX:ALL) share price can keep climbing appeared first on The Motley Fool Australia.

Should you invest $1,000 in Aristocrat right now?

Before you consider Aristocrat, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Aristocrat wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of August 16th 2021

More reading

Brokers name 3 ASX shares to buy today

2 top ASX shares that could be strong buys

Broker tips Aristocrat Leisure (ASX:ALL) share price to keep rising
Lithium surge, Sydney Airport takeover, ACCC torches Qantas deal. Scott Phillips on Nine’s Late News

The Aristocrat (ASX:ALL) share price has hit 10 new record highs in the past month

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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