“Aristocrat Leisure’s (ALL) first half 2025 result had the potential to be a messy one, following the Plarium divestment and limited visibility on the nascent Interactive unit,” Raymond said.

“What we didn’t foresee was an approximate 5% shortfall in the core land-based division vs MorgansF and consensus expectations, caused by softer leased FPD and adverse mix in North America.

“ALL has a proven record of delivering on result day; however, with the shares trading at more than twice its closest peer multiple, even a modest earnings dip is severely punished by the market.

“Shares were down as much as 15% intraday but have steadily recovered since.

“Despite the miss, we see no structural change in market dynamics and regard the weakness as a short-term timing and mix issue.

“Importantly, management reiterated its qualitative guidance of constant currency Net Profit After Tax excluding amortisation (NPATA) growth in financial year 2025 (MorgansF: approx. 4%).

“Following the result, our financial year 2026-2027F earnings per share (EPSA) estimates reduce by 6-7 %.

“We reiterate our ADD rating and our 12-month target price at $71,” Raymond said.

Aristocrat Leisure’s (ALL)