IGT's New Slot Game on Facebook

Zacks

International Game Technology (IGT) recently launched a free-to-play version of its popular online slot reel game Da Vinci Diamonds through the Double Down virtual Casino on the social networking site Facebook (FB). IGT acquired Double Down Interactive, the operator of the virtual casino in January this year.

Double Down Casino is the most popular casino-style social gaming application on Facebook, with more than 5.2 million monthly active users, according to AppData. There are currently 20 games that players can enjoy at the Double Down Interactive online casino on Facebook. Double Down is the exclusive license holder of the social version of Da Vinci Diamonds, originally developed by High 5 games.

Da Vinci Diamonds is a 3x5, 20 payline game, with a jackpot of 5000 coins. The most interesting features of this slot game are the Tumbling reel and free spin bonus which significantly increases the chances of a big win. Under the Tumbling reel feature symbols which made the winning combination disappear and new symbols drop in sequence to fill in the empty positions.

IGT launched the game way back in 2007 and the online version was exclusively available from its Wagerworks subsidiary. However, due to the legal prohibitions regarding Internet gambling in the U.S., the game was available only in Alderney, Gibraltar, United Kingdom and Malta, where online gambling is legalized. Despite this constraint Da Vinci Diamonds turned out to be the most successful online slot reel game for IGT.

Da Vinci Diamonds is IGT’s only slot game that is now available on multiple platforms including social, online and land based casino. IGT expects to launch a mobile version of the game going forward. We believe that the platform expansion will further boost the game’s popularity and user base over the long term.

We believe that this will also boost IGT’s top-line growth going forward. Although the game is free to play in Facebook, the company is expected to generate significant revenue from advertisement and through the in-game sale of virtual goods in exchange for virtual currency, which is known as micro-transactions.

Meanwhile, IGT recently announced that the Nevada Gaming Commission (:NGC) has granted the company license for online gaming. Upon getting the nod, IGT will be able to bring its online portfolio of interactive games to the Nevada casinos. We believe that this will further boost IGT’s revenue generation capability through its interactive gaming portfolio going forward.

We believe that IGT stands to benefit significantly from the massive growth opportunity of social and mobile games over the long term. According to market research firm BI Intelligence, the U.S. social gaming market (including mobile games) is expected to more than double from approximately $2.0 billion in 2011 to more than $5.5 billion by 2015. As per data from eMarketer, the majority of online gamers in the U.S. will soon be mobile gamers, reaching 174 million by 2016 from 80.8 million in 2011.

We believe that IGT has a strong product pipeline based on the acquisitions of Double Down and Entraction, which will help it to further penetrate the social and mobile gaming market. This will offset a sluggish domestic market due to lower play levels, a higher unemployment rate and weak replacement sales.

IGT is also seeking expansion opportunities in international territories to boost profitability. We believe that IGT will continue to focus on expanding its presence in international markets and will benefit from its licensing agreements over the long term.

We have a Neutral recommendation on the stock over the long term (6-12 months). Currently, IGT has a Zacks #2 Rank, which implies a Buy rating on a short-term basis.

Read the Full Research Report on IGT

Read the Full Research Report on FB

Zacks Investment Research



More From Zacks.com

Rates

View Comments (0)