The gaming industry, previous to 2007, had experienced a continued increase in revenues and stock prices, but in late 2007, the industry started to be affected by a recession. To have a better understanding of the relationship between this external economic factor (recession) and a gaming company\u27s systematic risk (beta), this study analyzed which financial ratios are significant predictors of beta and evaluated if these financial ratios better predict beta before or during the recession. The financial ratios examined in this study include return on assets, liabilities as a percentage of assets, asset turnover, quick ratio, EBIT growth rate, and market capitalization. The results revealed that market capitalization was the only variable that had significantly positive impact on beta both before and during the recession. Asset turnover was a significant predictor only before the recession while liabilities as a percentage of assets was significant only during the recession
