Now could be the time to pounce on Aristocrat Leisure Ltd (ASX: ALL) shares.

That's the view of analysts at Bell Potter, which are feeling very bullish about the ASX 200 tech stock.

What is the broker saying about this ASX 200 tech stock?

Bell Potter notes that Aristocrat is a global gaming content creation company that operates through three segments.

This includes Gaming, where it is the number one supplier of Electronic Gaming Machines (EGMs) into lease markets and the top three supplier into outright sales markets.

It also operates the Pixel United business, which is a top two developer and publisher of free-to-play social casino games on mobile and web platforms.

Finally, it has the Interactive business. It is the dominant supplier of iLottery services and supplier of online Real Money Gaming (RMG) content to online casinos.

Widening moat

According to the note, Bell Potter believes that the ASX 200 tech stock has been strengthening its competitive advantage over the past decade. It feels this positions it for more strong growth in the coming years. The broker explains:

ALL has fortified its competitive moat over the past decade by strategically targeting high-margin markets and outspending peers in Design & Development (D&D) – investing >60% more than its closest rival. This focus on content innovation drives share gains and underpins our forecast for 9% continuing EPSA CAGR (constant currency) through FY27e.

Key growth drivers: (1) continued share gains in the Nth. Am. Gaming Operations market as ALL launches compelling content from new and existing franchises; (2) continued penetration into Nth. Am. adjacent markets fuelling growth in outright sales; (3) 20-30% CAGRs in iLottery & iGaming GGR as these new markets ramp up in the US amplified by scaled IP leverage; (4) potential buybacks absent of possible large M&A transactions.

Time to buy

Bell Potter has initiated coverage on the ASX 200 tech stock this morning with a buy rating and $83.00 price target.

Based on its current share price of $73.72, this implies potential upside of 12.6% for investors over the next 12 months.

In addition, the broker expects a modest 1.2% dividend yield in FY 2025, boosting the total potential return to almost 14%.

Commenting on its buy recommendation, Bell Potter said:

We initiate coverage on ALL with a Buy rating. Whilst we observe the stock trades on historically elevated valuation levels with EV / EBIT(A) at 20x and P/E at 26x, we expect operating momentum in FY25 to accelerate in an accommodative market (i.e. investment flows) for high quality large caps.

Two months of game performance data indicates ALL's highly anticipated Phoenix Link game is likely growing its install base ahead of expectations with robust performance of 3.0x floor average. These early indicators signal possible VA consensus upgrades to FY25 Gaming Operations net adds (VA +5.2k; BPe +6.2k).