Highlights

  • Accel shows 67.34% one-year basic EPS growth, a P/E of 16.39 and PEG of -1.17.
  • Second quarter total net revenues were $368,125 thousand, up 9.6% from a year earlier.
  • Gaming terminals reached 29,281 at June 30, 2026, across 4,676 locations.
  • Accel held $255.5 million in cash and had $577,500 thousand of term loan borrowings.

One-year earnings growth of 67.34% in basic earnings per share, paired with a trailing twelve-month P/E of 16.39 and an expected-basis PEG of -1.17, puts Accel Entertainment (NYSE:ACEL) among undervalued growth stocks, with shares trading at USD 11.11 on October 28, 2026, down 0.71%. In its latest disclosures, the distributed gaming operator entered an interest rate collar on January 30, completed the Green Valley and Rice Palace acquisitions on June 1, and reported second quarter 2026 net income of $12,507 thousand in early August.

Accel Entertainment is based in Burr Ridge, Illinois, and incorporated in Delaware. It describes itself as a leading distributed gaming operator in the United States and a developer of brick-and-mortar casinos that serve local gaming markets and horse racing venues. It installs and operates gaming terminals and amusement devices in bars, restaurants, convenience stores and truck stops, and designs and manufactures gaming terminals. It operates in Illinois, Montana, Nevada, Nebraska, Georgia, Louisiana, Iowa and Pennsylvania, and has one reportable segment, distributed gaming.

Growth: Second Quarter Earnings, Revenue and Gaming Locations

Net income was $12,507 thousand in the second quarter against $7,262 thousand, and $27,170 thousand for the six months against $21,875 thousand. Basic earnings per share were $0.15 against $0.09, and diluted earnings per share were $0.15 against $0.08. For the six months, basic earnings per share were $0.33 against $0.26.

Total net revenues were $368,125 thousand against $335,909 thousand, up 9.6%. Net gaming revenue was $347,375 thousand, up 10.7%, which the company attributed to an increase in gaming locations, terminals and revenue from its casino operations. Manufacturing revenue was $568 thousand, down 67.8%, which the company attributed to lower equipment and software sales. Operating income was $32,053 thousand against $26,874 thousand, up 19.3%. Illinois net revenues were $264,476 thousand, up 7.8%.

Locations totaled 4,676 against 4,427 a year earlier, and gaming terminals totaled 29,281 against 27,388. Adjusted EBITDA, a non-GAAP measure, was $58,924 thousand against $53,180 thousand for the quarter.

Valuation: P/E of 16.39, PEG of -1.17 and Equity Figures

The P/E ratio of 16.39 is measured on trailing twelve-month earnings, and the PEG ratio of -1.17 is on an expected basis. Total stockholders' equity was $283,864 thousand at June 30, 2026, against $269,683 thousand at December 31, 2025.

The loss on the change in fair value of contingent earnout shares was $5,018 thousand in the second quarter against $5,734 thousand, which the company said depends primarily on the market value of its Class A-1 stock. The effective tax rate was 31.9% against 41.2%.

Capital Returns and Balance Sheet: Buybacks, Term Loan and Acquisitions

Accel repurchased 477,598 shares of Class A-1 common stock in the second quarter at an average price of $11.68, and $145.6 million remained available under its repurchase program at June 30, 2026. The program, amended on February 27, 2025, allows repurchases of up to $200 million.

Cash and cash equivalents were $255,451 thousand against $296,566 thousand at December 31, 2025. The term loan facility stood at $577,500 thousand against $600,000 thousand, with no revolving credit borrowings against $12,000 thousand. The Credit Agreement provides a $300.0 million revolving facility and a $600.0 million term loan facility maturing September 10, 2030, at a weighted-average interest rate of approximately 5.5%. The company was in compliance with its covenants.

Acquisitions included Admira for $2.8 million on April 15, Green Valley for $5.8 million and Rice Palace for $6.1 million, both on June 1.

Disclosed Risks and Outlook: Manufacturing, Litigation and Capital Spending

General and administrative expenses were $59,556 thousand against $54,878 thousand, up 8.5%, which the company attributed to higher compensation-related costs, professional fees and advertising. Nevada location hold-per-day was $660 against $784, down 15.8%.

The company disclosed several legal matters. J&J Ventures Gaming has challenged Illinois Gaming Board rulings that were largely in the company's favor. In July 2026, a trial court remanded the Midwest Electronics Gaming administrative review to the Illinois Gaming Board, and no monetary damages are sought against Accel. Two Illinois municipal matters, one on a terminal operator tax and one on an additional-tax ordinance, are on appeal. Management stated that it believes the outcome of pending matters will not have a material adverse effect on financial position or results of operations.

The company noted that interest rate uncertainty, inflation, the conflict in Iran and tariffs may increase recession risk, and said it had not observed material impacts on its business or outlook for the first half of 2026. It anticipates capital expenditures of approximately $60-70 million in 2026. The filing contains no earnings guidance.