LAS VEGAS, Aug. 10 /PRNewswire/ -- Coming off a flat month, the AGEM Index regained its upward momentum during the month of July, posting a value of 106.29, which represented an increase of 15.88 points (17.6 percent). The index broke through some significant barriers during the month, posting the third largest single-month gain since the index's inception. It is the only period thus far in which all members of the index posted an increase in their stock valuation from the previous month. The index also surpassed the 100-point value, the first time since August of 2008. While each member positively contributed to the index, more than 85 percent of the gain originated from the largest global gaming suppliers (based on market capitalization). The top five contributors to the index included: (1) International Game Technology (IGT), adding 6.70 points to the index due to a 24.21-percent increase in its stock valuation; (2) Bally Technologies (BYI), contributing 1.96 points to the index based on a 21.02-percent gain in its stock valuation; (3) Aristocrat Technologies (ALL) which was up 18.21 percent added 1.88 points; (4) Konami (KNM), contributing 1.75 points to the index driven by a 12.89-percent increase in its stock valuation; and (5) Lottomatica (LTO) which was up 8.16 percent added 1.24 points to the index.
On a year-over-year basis, the AGEM Index is up 1.4 percent, outpacing a 22.1-percent decline in the broader market (S&P 500), indicating investors in the global gaming sector may be looking beyond the economic cycle and pinning expectations on emerging markets. That said, investor optimism may be ahead of consumers as the majority of fundamental indicators have simply slowed their pace of decline and have yet to report absolute gains.
Indicators such as willingness to travel, the cost of gasoline, and shifts in the spending and savings rate of consumers will be important in revitalizing the growth of the gaming industry and its suppliers. However, the most pivotal barometers to the industry's growth and health will be lower unemployment rates in not only local gaming markets but nationally as well.
Exchange: Stock Price at Percent
Symbol month end Change
AGEM (Currency) Jul- June- Jul- Prior Prior Index
09 09 08 Period Year Contribution
Ainsworth Game
Technology ASX: AGI (AU$) 0.08 0.07 0.12 14.29 (33.33) 0.01
Aristocrat
Technologies ASX: ALL (AU$) 4.48 3.79 4.85 18.21 (7.63) 1.88
Astro Corp. Taiwan
3064(NT$) 72.90 54.50 73.20 33.76 (0.41) 0.24
Bally
Technologies NYSE: BYI (US$) 36.21 29.92 31.79 21.02 13.90 1.96
Elixir Gaming
Technologies AMEX: EGT (US$) 0.17 0.16 1.17 6.25 (85.47) 0.01
GameTech
International Nasdaq: GMTC
(US$) 1.98 1.66 4.26 19.28 (53.52) 0.02
Gaming
Partners Nasdaq: GPIC
International (US$) 7.07 5.10 3.44 38.63 105.52 0.10
Global Cash
Access NYSE: GCA (US$) 9.00 7.96 5.99 13.07 50.25 0.43
IGT NYSE: IGT (US$) 19.75 15.90 21.71 24.21 (9.03) 6.70
Konami NYSE: KNM (US$) 21.45 19.00 31.42 12.89 (31.73) 1.75
Lottomatica MILAN: LTO.MI
(GTECH) (euro) 14.85 13.73 20.09 8.16 (26.08) 1.24
Multimedia Nasdaq: MGAM
Games (US$) 5.62 4.96 5.16 13.31 8.91 0.09
Shuffle Master Nasdaq: SHFL
(US$) 7.20 6.61 4.83 8.93 49.07 0.16
Transact
Technologies Nasdaq: TACT
(US$) 5.48 4.98 9.23 10.04 (40.63) 0.02
Wells-Gardner
Electronics AMEX: WGA (US$) 1.22 0.98 1.48 24.49 (17.57) 0.01
WMS Industries NYSE: WMS (US$) 36.16 31.51 28.18 14.76 28.32 1.23
Change in
Index Value 15.88
AGEM: June 2009 90.41
AGEM: July 2009 106.29
ANALYSIS PROVIDED BY UNION GAMING GROUP
Gaming suppliers' market performance is correlated with macro data and broader markets. July was an important step in the recovery of the markets, particularly for the consumer discretionary stocks - such as casino operators, which gaming equipment stocks typically key off of. The S&P 500 crossed 1000 for the first time since the fall of Lehman Brothers. The equipment stocks all made new highs on excitement surrounding broader market earnings reports and better relative news from IGT. Sector specific events also bolstered the group as Ohio, Illinois, and Delaware looked likely to execute on proposed gaming expansion.
One by one, casino operators from U.S. to Asia suggested stability in their businesses providing for additional confidence. Early signs of capital expenditure recovery surfaced, suggesting the worst of the storm has blown by. Most of the macro data released during the month still looked weak, especially jobless claims and housing starts, but summer bulls were able to prevail as the rate of change also suggested the worst was in the rear view mirror. While there will continue to be conflicting signals surrounding recovery, July 2009 may have marked the beginning of the new bull market. Earnings reports in August will be important pieces to the market puzzle, and whether or not the bulls may continue their summer run, or bears will take back the market they have dominated since July of 2007.
The AGEM Index
The Association of Gaming Equipment Manufactures (AGEM) produces the monthly AGEM Index that comprises 16 global gaming suppliers throughout the world. A total of 12 suppliers are based in the United States and are listed on the NYSE, Nasdaq, or AMEX, while two trade on the Australian exchange, one supplier trades on the Milan exchange and another trades on the Taiwan OTC exchange. The index is computed based on the month-end stock price (adjusted for dividend splits) of each company and weighted based on approximation of market capitalization. Market capitalizations for manufacturers trading on foreign exchanges have been converted to US dollar-equivalents as of month-end for comparability purposes. The AGEM Index is based on a 100-point value as of January 2005.
About AGEM
AGEM is an international trade association representing manufactures of electronic gaming devices, systems, and components for the gaming industry. The Association works to further the interests of gaming equipment manufactures throughout the world. Through political action, tradeshow partnerships, information dissemination and good corporate citizenship, the members of AGEM work together to create benefits for every company within the organization. Together, AGEM and its member organizations have assisted regulatory commissions and participated in the legislative process to solve problems and create a positive business environment.
AGEM Membership Roster
The current AGEM membership roster, 79 strong, is a who's who of the supplier segment of the global gaming industry: AGEM Gold Members: Aristocrat Technologies, Aruze Gaming America, Austrian Gaming Industries, Bally Technologies, GTECH/Atronic/Spielo, International Game Technology (IGT), Konami Gaming and WMS Gaming. AGEM Silver Members: AC Coin & Slot, Action Gaming, Casino Technology, Interblock USA, JCM Global, MEI, Multimedia Games, Octavian International, Shuffle Master, Suzo-Happ Group, TCSJohnHuxley and Wells-Gardner Electronics. AGEM Bronze Members: Ainsworth Game Technology, Astro Corp., Cadillac Jack, Cammegh Limited, CashCode / Crane Payment Solutions, Diamond Game, Digital Display Group, Euro Games Technology (EGT), GameTech International, Gaming Support, Incredible Technologies, Jumbo Technology, KGM Gaming, Las Vegas Gaming Inc. (LVGI), MCA Processing, Modern Gaming, Rocket Gaming Systems and Summit Gaming. AGEM Associate Members: CMYK Creative, Cole Industries, Cybertec Gaming Systems, DynaGraphic Printing, Elite Casino Products, Esterline Advanced Input Systems, FutureLogic, Gaming Partners International, Gary Platt Manufacturing, Global Cash Access, Global Gaming Group (G3), Grand Products, Greenberg Traurig LLP, Howard & Howard, IDX, Intel, IPS, James Industries, Kreller Group, KSK, Lewis & Roca, Masterpiece Advertising, MC2, Mikohn Signs and Graphics, Money Controls, Nanoptix, Paokai Electric Enterprise Co., Proforma GPS, Regulatory Management Counselors, Sanmina-SCI, Strategy9, Tgraphics/Outpost Productions, The Bright Group, 3M Touch Systems, Tournament One, TMX, Trade Show Fabrications, TransAct Technologies, Veridocs, Wrex Products and Young Electric Sign Company (YESCO).
AGEM Index and Overview
The AGEM index and overview is prepared by Applied Analysis (AA). AA is a Nevada-based advisory services firm providing a wide range of consultation services for public and private entities. The company utilizes extensive experience in economics, information technology and finance to provide a wide range of services, including urban economic consulting, financial advisory services, market analysis, public policy analysis, hospitality industry and gaming consulting, and information system consulting.
Industry Analysis
Industry Analysis is prepared by Union Gaming Group (UGG). UGG is an independent research firm, government and industry advisor, focusing on the global gaming business. UGG provides research, access and advisory services and offers varying levels of research products and services, which capitalize on UGG's relationships with corporate managements, governments, and other parties relevant to the global gaming business.
Data and information contained herein is provided for informational purposes only, and is not intended for investment, company evaluation or other decision-based purposes. This analysis is based on selected economic data from a wide range of economic data and statistics and is not intended to be a comprehensive overview of all economic factors. Neither Association of Gaming Equipment Manufactures, its members, partners, principals or employees nor any of its data or content providers shall be liable for any errors in the content, or for any actions taken in reliance thereon. By reviewing this data, a user agrees not to redistribute the information found therein. AGEM shall not be liable for any actions taken in reliance thereon.
CONTACT: Paul Speirs, +1-702-413-4278, paulspeirs@cox.net, for Association of Gaming Equipment Manufacturers (AGEM)
