UPDATE: Deutsche Bank Downgrades Scientific Games to Sell on Business Model Challenges

Deutsche Bank downgraded Scientific Games

from Hold to Sell and lowered the price target from $7.00 to $6.00. Deutsche Bank noted, "In short, we believe SGMS's business model remains challenged given; 1) bidding on lottery privatizations, thought to be the next leg of growth for SGMS, have become more competitive, thereby elevating the potential for lower returns, 2) structural changes to online lotteries have been slow to materialize and have failed to move the needle from an EPS perspective, 3) the core business has become more competitive and faces structural challenges, and 4) the elevated leverage and limited FCF restrain the valuation multiple." Scientific Games closed at $9.49 on Monday.